Business before Questions

Recall of MPs Act 2015: Member for Rutherglen and Hamilton West

Lindsay Hoyle: I have received notification from the Petition Officer for the constituency of Rutherglen and Hamilton West, in respect of the recall petition for Margaret Ferrier. The recall petition closed on Monday 31 July. As more than 10% of those eligible to sign the petition did so, the petition was successful and the seat is accordingly vacant. I shall cause the text of the notification to be published in the Votes and Proceedings and in the Official Report.
[The notification will appear at the end of today’s proceedings.]

New Members

The following Members took and subscribed the Oath, or made and subscribed the Affirmation, required by law:
Keir Alexander Mather, for Selby and Ainsty.
Steven Tuckwell, Uxbridge and South Ruislip.
Sarah Joanne Dyke, Somerton and Frome.

New Writs

Ordered,
That Mr Speaker do issue his Warrant to the Clerk of the Crown to make out a new Writ for the electing of a Member to serve in this present Parliament for the Borough constituency of Rutherglen and Hamilton West in the room of Margaret Ferrier, against whom, since her election for the said Borough constituency, a recall petition has been successful.—(Owen Thompson.)
Ordered,
That on the 12th day of September, Mr Speaker do issue his Warrant to the Clerk of the Crown to make out a new Writ for the electing of a Member to serve in this present Parliament for the County constituency of Mid Bedfordshire, in the room of Nadine Vanessa Dorries, who since her election to the said County constituency has been appointed to the Office of Steward or Bailiff of His Majesty’s Three Chiltern Hundreds of Stoke, Desborough and Burnham, in the county of Buckingham.—(Simon Hart.)

Speaker’s Statement

Lindsay Hoyle: I wish to inform the House that I have received a letter from the hon. Member for Bristol North West (Darren Jones) informing me of his resignation as Chair of the Business and Trade Committee. I therefore declare the Chair vacant. I will announce the arrangements for the election of the new Chair in due course.

Oral
Answers to
Questions

Work and Pensions

The Secretary of State was asked—

Regional Inequalities in Employment

Christian Wakeford: What assessment his Department has made of the effectiveness of its policies on reducing regional inequalities in employment.

Kate Osborne: What assessment his Department has made of the effectiveness of its policies on reducing regional inequalities in employment.

Andy McDonald: What assessment his Department has made of the effectiveness of its policies on reducing regional inequalities in employment.

Mel Stride: It is good to be back, Mr Speaker. I trust that you had at least some rest during the recess. Let me also extend my welcome to the new Members who have just taken their seats.
The regional employment rate gap is 7.7 percentage points, which is 1.2 percentage points less than the gap in 2010 and a low figure by historical standards.

Christian Wakeford: As the Marmot review shows, there is a strong correlation between indices of deprivation and addiction. This issue affects all regions, but especially the poorer regions. What policies are in place across the regions to address the issue of addiction and to help more people remain in and enter employment, particularly in the north-west?

Mel Stride: The hon. Gentleman will be aware of universal support and the WorkWell pilots. In exactly the areas to which he has referred, they are bringing together healthcare and help with seeking work, which my party believes to be one of the best ways to remedy the issues he has mentioned, including mental health issues.

Kate Osborne: It is 87 years since the Jarrow march against unemployment, and my constituents are still being let down. We have a higher percentage of people claiming unemployment benefits than the national average, and the reality is shown to be worse when hidden unemployment is factored in. According to the Centre for Cities, nine in 10 of the places with the highest hidden unemployment rates are in the north. Instead of continuing their false rhetoric on levelling up, when will the Government stop neglecting and start investing in our northern communities?

Mel Stride: I have no problem at all with defending the Government’s record on employment. There are now nearly 4 million more people in employment than there were in 2010, including about 2 million more women, and unemployment across the country, including in the north, is at a near-historic low.

Andy McDonald: In his blog today on ConservativeHome, Lord Ashcroft says:
“On the cost of living, two thirds of voters...thought the Government could do more to help but was choosing not to.”
Given the regional disparity in earnings, does the Secretary of State accept that the roll-out of fair pay agreements providing sectoral minimum terms, as outlined in Labour’s “A New Deal for Working People”, would not only boost the economy but address the blight of in-work poverty and insecure work that is having an impact on so many households in my constituency and throughout the country?

Mel Stride: The hon. Gentleman raises the issue of support during the cost of living squeeze that we are experiencing. My Department has been responsible for distributing millions of payments to the most vulnerable people, including £900 in total to 8 million low-income households, £150 to 6 million disabled people and the £300 payment to pensioners. On the question of work, we put up the national living wage by over 9% to £10.42 this April.

Paul Maynard: In parts of my constituency, the healthy life expectancy is now just 53 to 54—a true regional inequality if ever there was one. That means that people—even those in the Minister’s age group—are dropping out of work far too early, which is not good for them or the economy. What steps is the Department taking as a consequence of the health and disability White Paper to address this serious inequality?

Mel Stride: I have already mentioned the measures that we brought forward at the last Budget, including universal support and WorkWell. The Government are of course constantly looking at how we can go further in that respect. On the over-50s specifically, the midlife MOT that we are running, the returnerships and the changes to the pension tax arrangements are all helping to bear down on economic inactivity in that group.

Philip Hollobone: The good news from Kettering is that, at 3.6%, the overall unemployment rate is below the national average of 3.7%. The bad news from Kettering is that there are 420 18 to 24-year-olds without work and the youth unemployment rate is 6.2%, versus the national average of 4.7%. What is the Secretary of State doing to address youth unemployment?

Mel Stride: My hon. Friend will be pleased to know that since 2010, youth unemployment has fallen by over 40%, which is the mirror image of what happened under the last Labour Government when it rose by over 40%. On his specific question, I point him towards the youth offer, which we have recently announced we will be expanding to even more young people.

Lindsay Hoyle: I call the shadow Minister.

Alison McGovern: I thought the Secretary of State understood that, while unemployment is at a historic low, economic activity is the big challenge before us, particularly when it comes to regional economic inactivity and the huge, near 10-point gap across the regions. The east midlands, London, the north-east, the north-west and the west midlands all have higher inactivity rates than the south-east. The Tories have had 13 years to close that gap, so can I ask the Secretary of State: is his plan really to make levelling up a reality by leaving it to Labour?

Mel Stride: Given that there has never been a Labour Government who have left office with unemployment anything other than higher than they found it in the first place, I do not think I would leave employment to Labour. On the hon. Lady’s point, economic inactivity is important and it is a major focus for my Department. It has of course reduced substantially since its peak during the pandemic, having fallen by around 350,000.

Cost of Living: Means-tested Benefit Claimants

Harriett Baldwin: What steps his Department is taking to help claimants in receipt of means-tested benefits with increases in the cost of living.

Mims Davies: The Government recognise the pressures people are facing and we have acted. We are providing cost of living support worth over £94 billion between 2022 and 2024 to help households and individuals with those rising costs. That includes cost of living payments totalling up to £900 in 2023-24 for over 8 million households on eligible means-tested benefits. We successfully delivered the first payment of £301 to 8.3 million households earlier this year, and the second payment of £300 will be paid in the autumn.

Harriett Baldwin: The Government are indeed giving generous cost of living support to households on certain means-tested benefits this winter, but if someone is on one of those means-tested benefits and they earn £1 more, they have the potential to lose the full payment. I wonder if the Minister has noticed any change in people’s behaviour as a result of that disincentive to take on extra work.

Mims Davies: It is vital that those on low incomes, or indeed those who are keen to work more, see the incentives. In the spring Budget, we announced an ambitious package of measures to support people to take up work and, importantly, to progress by making sure that they are always better off. We are also supporting them with a significant investment in childcare and, of course, the largest ever cash increase to the national living wage, taking it up to £10.42. I would say to those people that they should look at the benefits calculator on gov.uk, because they will always be better off in work.

Lindsay Hoyle: I call the Chair of the Select Committee.

Stephen Timms: Rents have risen very sharply over the past couple of years, but the support for people claiming means-tested benefits to pay their rent, determined by local housing allowance, has not changed at all since 2020—it has been completely frozen. I wrote to the Secretary of State about this over the summer. Is the Minister able to give the House any assurance that the forthcoming benefit uprating statement will include a realistic increase in local housing allowance?

Mims Davies: I know that the right hon. Gentleman is very interested in this subject, as am I. Again, there is help for households, with the local housing allowance rate being set at the 30th percentile in 2020. The Government are projected to spend around £31 billion, or around 1.2% of GDP, on support for renters in 2023-24. It is absolutely right that we support people to be better off. The LHA is not intended to cover all rents in all areas, but I take a close interest in this subject.

Unemployment

Chris Elmore: What assessment his Department has made of trends in the level of unemployment over the last 12 months.

Judith Cummins: What assessment his Department has made of trends in the level of unemployment over the last 12 months.

Guy Opperman: I welcome our three new colleagues.
The independent Office for National Statistics estimates that, notwithstanding a recent uptick, the unemployment rate is now almost half the rate we inherited in 2010 and is back to pre-pandemic levels.

Chris Elmore: Actually, according to the Government’s own figures, three and a half years after the pandemic began, employment is not back to pre-pandemic levels. Will the Minister set out what the unanticipated rise in unemployment says about the underlying health of our economy? It is not looking good, is it?

Guy Opperman: With great respect, I disagree. Employment is at record levels. Vacancies have been down for the past 10 quarters. Payroll employment is at a record high. Pay is up and inflation is down. We are doing an awful lot better than that lot would.

Judith Cummins: We have seen a summer of job cuts in my Bradford South constituency, with both Morrisons and Solenis announcing major redundancies. Does the Minister agree that this shows that the Government’s plan to grow the economy is failing?

Guy Opperman: I should make the point that payroll employment is at a record high. There are 4 million more people in work than in 2010, and the unemployment rate is down to 4.2% across the UK—that is a near record low. Our jobcentres are clearly doing a fantastic job, and I fully support all the work that is going on in Bradford to try to address these issues.

Inflation and Food Prices: Pensioners

Gerald Jones: What assessment his Department has made of the potential impact of trends in the level of (a) inflation and (b) food prices on pensioners’ incomes.

Samantha Dixon: What assessment his Department has made of the potential impact of trends in the level of (a) inflation and (b) food prices on pensioners’ incomes.

Laura Trott: In April, the state pension saw its largest ever rise of 10.1%, thanks to the triple lock protecting pensioners.

Gerald Jones: We know that 770,000 pensioners are eligible for pension credit but are not receiving it. A few months ago, I joined my local citizens advice bureau to organise a pension credit action day. As a result, an additional £200,000 was drawn down to people across Merthyr Tydfil and Rhymney. The Government have the data and could take a much more targeted approach to get eligible people to apply, so why have they not taken that action? When will we see more action from the Government?

Laura Trott: I thank the hon. Gentleman for the work he is doing in his constituency. I assure him that that is exactly what the Government are doing. We recently launched an “invitation to claim” trial, which has been rolled out in 10 constituencies and is using housing  benefit data to target those who might also be eligible for pension credit. We will report back on the results of that trial later this year.

Samantha Dixon: It might be hard to imagine on a sunny day like today, but winter is just around the corner. The reality for many worried pensioners in my constituency is that this winter there will be a choice between heating and eating. We have a Government who are tiptoeing around the real issues while our constituents struggle to make ends meet. When will the Government make a real plan to tackle the cost of living crisis and implement meaningful action to help thousands of pensioners in poverty?

Laura Trott: With respect to the hon. Lady, that is exactly what we are doing. That is why we have put the cost of living payments in place, which are worth £900 to all those on pension credit, and why a cost of living pensioner payment worth £300 is coming out in the winter. All the while the Labour Mayor of London is charging pensioners £12.50 when they want to drive to the hospital.

Bob Blackman: Clearly, there is a stigma attached to claiming pension credit, because this is on poorer pensioners who desperately need the money. What action can my hon. Friend take to remove that stigma? My constituency has recently been added to the pilot, and I am looking forward to its results, because elderly people deserve to get the money they need to fulfil their lives.

Laura Trott: My hon. Friend is absolutely right on that, and I praise all the work he has done in his constituency on pension credit. We are trying to do exactly what he sets out: encourage as many people as possible to claim this important benefit, at a time when they are going to need it most. I note that across the House good work has been done in individual constituencies.

Lindsay Hoyle: I call the shadow Minister.

Matt Rodda: As inflation rises, being able to top up pension contributions is vital for many part-time workers, who would otherwise not be able to claim the full state pension. However, a Daily Mail investigation showed that the Government are failing to accurately record people’s top-up contributions. Pensioners are terrified that their money has simply disappeared, so when will the Government get a grip of this terrible problem? When will Ministers show that they understand the pressure on families and pensioners due to the cost of living crisis?

Laura Trott: With the comprehensive package of support I have talked about today, we have shown that we are taking action during the cost of living crisis to help pensioners as much as we can. We know that accuracy is the most important thing when it comes to the state pension, which is why we have taken action very quickly to correct issues where they have occurred, for example, with LEAP—the legal entitlement and administrative practices exercise. We will do the same in all such cases.

Employment: Essex

Priti Patel: What steps he is taking to increase employment in Essex.

Guy Opperman: I know that my right hon. Friend is a champion for job creation in Essex, where our jobcentres are working with a range of employers and partners to address recruitment on an ongoing basis. For example, last Wednesday, Essex jobcentres hosted a recruitment event at Stansted airport to match constituents of hers, and of my right hon. Friends the Members for Saffron Walden (Kemi Badenoch) and for Braintree (James Cleverly), and of my hon. Friend the Member for Colchester (Will Quince), to dozens of catering, hospitality and logistics-based jobs.

Priti Patel: Essex is a powerhouse on jobs and employment, but there is always more to do and businesses are saying that they are finding barriers to creating more jobs. Will the Minister give an update on how he is working across government to create a labour market strategy to help enable businesses to recruit, to lower taxes and burdens for businesses, and, in particular, to make it easier for small businesses in counties such as Essex to start employing more people and to recruit?

Guy Opperman: I endorse pretty much everything that my right hon. Friend says. Clearly, we are working with other Departments to ensure that we are doing everything possible to address recruitment. For example, on a recent visit I saw the T-levels being pioneered at South Essex College; I have seen the apprenticeships that are being driven forward locally; and, recently, in Witham, the “midlife MOT” took place in the middle of last month to address older workers. However, there is more to do and we are certainly trying to do it across Departments.

Carol Monaghan: In Essex, as in many other parts of the UK, the number of people off work because of chronic illness is significantly higher now than it was before the pandemic. Forcing sick people into work is not an appropriate way of dealing with that, so will the Minister confirm that work capability assessments will be reasonable and will consider all aspects of the individual’s life in assessing whether they really are fit for work?

Guy Opperman: The hon. Lady’s constituency is a long way from Essex, Mr Speaker! She will, however, be aware that over 1 million more disabled people are in work and that the WCA will continue on an ongoing basis until there is reform.

Pension Credit

Vicky Ford: What steps his Department is taking to increase the number of eligible people claiming pension credit.

Laura Trott: The DWP has conducted an extensive campaign across TV, radio and social media, and with partner organisations, to boost pension credit take-up, with a number of pushes being made before  cost of living payment deadlines. I am pleased to tell the House that that is working; applications were up by 75% in the year to May.

Vicky Ford: One of my Chelmsford constituents sent me a message that has been circulating recently. It suggests that asylum seekers are entitled to receive more in benefits than pensioners; I believe that is not accurate. For the record, will the Minister confirm what support is available for pensioners, compared with that for asylum seekers?

Laura Trott: Let me reassure my right hon. Friend and her constituents that asylum seekers are given no recourse to public funds. They are given payment for their food and shelter, but they are unable to claim benefits. Pensioners in her constituency will receive a state pension, if they qualify, which for the first time is worth on average more than £200 per week or over £10,000 a year. Pensioners who have not built up sufficient contributions may be eligible for pension credits, worth on average £3,500 per year, to top up their income. They are also eligible to receive the cost of living payment, if they ever receive pension credit, and the pensioner cost of living payment.

Cat Smith: Over the summer, I held events in villages across Wyre in my constituency. I was approached by many pensioners who are suffering because of the cost of living crisis; pension credit is just not plugging the gap. At my “Chat with Cat” event in Pilling, a constituent asked me why 400,000 more pensioners are living in poverty than when Labour left office. Will the Minister answer that question?

Laura Trott: There are 200,000 fewer pensioners in absolute poverty than when Labour left office.

Personal Independence Payment Assessments

Sarah Green: What assessment he has made of the adequacy of the assessment process for personal independence payments.

Tom Pursglove: Assessments play an important part in ensuring people get the right entitlement. It is the claimant’s chance to give all the information needed to help make the right decision. The assessment, which measures the impact of a health condition on a person’s ability to live independently, is kept under review; I am sure the hon. Lady is familiar with the tests and trials set out in the White Paper.

Sarah Green: The Minister will know that one challenge with PIP is how to accurately assess fluctuating conditions. More than half a million people in the UK are living with Crohn’s disease or colitis, but fewer than 3% are in receipt of PIP. Past applicants have said that while fatigue is the most disabling symptom, they feel that that is the least represented symptom in their assessments. [Interruption.] Would the Minister consider introducing a fatigue rating  scale to PIP assessments to more effectively capture what is, for many, the most debilitating component of their condition?

Lindsay Hoyle: Minister, the reason I was coughing was that the question was rather long.

Tom Pursglove: I am grateful to the hon. Lady for her interest in this issue. Through the White Paper reforms, we have advocated for a number of tests and trials, including one that focuses specifically on better capturing fluctuating conditions. I would be keen to have conversations with her about that. The Government are committed to working with charities and those that are interested, including disabled people, to ensure we get those reforms right.

Nigel Mills: I agree with the importance of having a timely assessment. Last week, a constituent raised her case with me: she filled in her renewal form nine months ago, but has been given less than two weeks’ notice for an assessment next week. Surely we need to have assessments when the form is fresh and accurate, not nine months later?

Tom Pursglove: The waiting time for PIP decisions has come down considerably in recent times, but I am not complacent about that, as we want to go further in seeing those waits reduced. For example, being able to apply online is an important part of that journey, as well as improving interfaces and making sure people provide all the right information up front. If we can provide better support for that, it will help us make decisions sooner, which can only be welcome.

Chris Bryant: I urge the Minister to look specifically at how PIP is assessed for those with brain injuries. It is well known that the effect of a brain injury may vary over time—people go up and down, and many who have had a brain injury want to give a very positive impression of how they are, which gives a false impression when it comes to assessing whether they need PIP.

Tom Pursglove: I am very sympathetic to the hon. Gentleman’s point—he has been a passionate and tireless campaigner on the issue of brain injury for a long time. These are exactly the sorts of issues that we want to look at as we take this reform forward. I mentioned our changes around fluctuating conditions, but we also want to look at issues such as expert assessors and having specialists working with individuals to carry out the assessment to ensure a proper understanding and, hopefully, build confidence around decision making.

Justin Tomlinson: Our excellent, proactive Minister is no doubt testing out concepts ahead of the forthcoming White Paper. Does that include extending the severe conditions criteria so that people with conditions such as motor neurone disease can automatically access support without the need of an assessment?

Tom Pursglove: I am fortunate that my hon. Friend was one of my predecessors as Minister for Disabled People, as he is a tireless campaigner on these issues and has done much to take the agenda forward. On the  severe disability group, we remain committed to this work. We have worked with an expert group of specialist health professionals to draw up a set of draft criteria. We have started initial testing at small scale, and we are looking to scale that up as we move forward, because we want to get this right and we think that this is a significant change.

Access to Work

Daniel Zeichner: What steps his Department is taking to help reduce waiting times for Access to Work assessments.

Neil Coyle: Whether his Department plans to take steps to reduce the time taken by the decision-making process for applications to the Access to Work scheme.

Tom Pursglove: Access to Work has received a significant increase in applications over the past year and has recruited new staff to meet the increased demand and reduce the time it takes to make decisions. We are also transforming the Access to Work service through increased digitalisation that will make the service more efficient and the application process easier, and improve the time taken from application through to decision.

Daniel Zeichner: I think the Minister knows that the waiting times are too long for all applicants, but may I draw his attention to an event in Cambridge that I hosted earlier this year with the local jobcentre where we highlighted job opportunities for the neurodivergent community? Will he tell us what impact these long waits have on people who are neurodivergent?

Tom Pursglove: I am sure the hon. Gentleman will be pleased to know that, last week, 88% of claims were paid within 10 days and that we are taking steps to drive further improvement. The online application capacity that came on stream in June is a significant part of that, but we are also putting additional staff on to processing claims. We are streamlining various processes to ensure that people get access to that support sooner. Anecdotally, officials are saying that that is beginning to bear fruit. What we are not doing is speeding up that process at the cost of getting the right decision and the right outcome. We will continue to move this forward, and we are already making progress.

Neil Coyle: A decade ago, the Government’s Sayce review recommended supporting 100,000 disabled people through specialist employment programmes, but, last year, Access to Work helped just 38,000, and Versus Arthritis and other organisations that support people navigate this difficult system saw a tripling in the delays. When will the Department meet the 100,000 target and end the delays hitting disabled people, employers and the UK economy?

Tom Pursglove: Like the hon. Gentleman, I am passionate about the positive difference that Access to Work makes in terms of opening up employment opportunities for people. He will be aware of the passports that we have introduced to help better understand people’s needs and passporting that between jobs and between, for  example, education and employment. I refer him back to the steps that we have taken to see improvement in the journey times, but we will continue to work tirelessly to make sure that people get the Access to Work help as quickly as possible.

Lindsay Hoyle: I call the shadow Minister.

Vicky Foxcroft: In January, it was found that the Access to Work backlog had trebled since February 2020, rising to more than 25,000. In June, the Minister claimed additional resource was being put into Access to Work. Will he inform the House exactly how many additional staff are working to clear the backlog and when he expects it to return to pre-pandemic levels? His Government say that they want to get more people into work, yet disabled people are missing out on jobs because of unacceptable delays at the DWP.

Tom Pursglove: For the House’s benefit, let me provide the full-time equivalent staffing levels in the Access to Work team a full six months ago and once the staff at Bradford have moved to Access to Work. The figure stood at 375.22 full-time equivalents in March 2023, and at 462.84 on 4 September 2023. That figure is expected to stand at 530.41 full-time equivalents by the end of October 2023 with the additional staff moving to the Access to Work team in Bradford. I direct the hon. Lady’s attention again to the figure from last week that 88% of claims were paid within 10 days. This is a priority for me as the Minister for Disabled People and for the Department as a whole.

Two-child Limit: Child Poverty

Richard Thomson: What assessment his Department has made of the potential impact of the two-child limit on trends in the level of child poverty.

Amy Callaghan: What assessment his Department has made of the potential impact of the two-child limit on trends in the level of child poverty.

Guy Opperman: The Government’s firm belief is that the best route out of poverty is through work. In the most recent statistics—in 2021-22—there were 400,000 fewer children living in absolute poverty after housing costs than in 2009-10.

Richard Thomson: A recent study by the University of York found that the two-child limit and the benefit cap had contributed to rising child poverty, which, allied to wider benefit cuts, had impacted larger families disproportionately. Given the growing weight of evidence that families are being pushed further into hardship, will the Government finally acknowledge the real harm that their cruel and callous welfare policies are causing, and reverse them?

Guy Opperman: Families on benefits should face the same financial choices when deciding to grow their family as those supporting themselves solely through work. A benefit structure adjusting automatically to family size is unsustainable.

Amy Callaghan: A report by the Child Poverty Action Group showed that the two-child limit affects one in 10 children across the UK. It found that abolishing the policy would be the most cost-effective action that the Government could take to reduce child poverty. Why will the Minister not take that action? Is child poverty so low on his priority list that he has not considered it, or did he consider it and then decide that vulnerable children just are not worth it?

Guy Opperman: The Government are committed to a sustainable long-term approach to tackling poverty and supporting people on low incomes. We will spend around £276 billion through the welfare system in 2023-24, including around £124 billion on people of working age and children.

Lindsay Hoyle: I call the SNP spokesperson.

David Linden: The Minister seems to forget that the two-child limit impacts people who are on in-work benefits. The only exemption to the two-child limit is if a woman can prove that her third or a subsequent child has been born as a result of rape. How many people has the Minister’s Department asked to prove that they have been raped in order to get an exemption to the two-child limit?

Guy Opperman: We do not use the language used by the hon. Gentleman, but I will of course write to him.

David Linden: I am disappointed that the Minister does not know, because his Department has made 2,590 women prove and relive the ordeal of being raped, simply to get that state support, but given that the Labour party and the Conservatives support the two-child policy and rape clause, does it give him comfort to know that when the “Ghost of George Osborne Future” comes into office, his legacy in promoting astronomical child poverty rates will be safe in the hands of the Blairites on the Labour Benches?

Guy Opperman: I can only repeat that, compared with 2009-10, there are 400,000 fewer children in absolute poverty after housing costs.

Benefit Fraud

Mark Fletcher: What recent progress his Department has made on tackling benefit fraud.

Mel Stride: We continue to bear down on fraud and error. It decreased by 10% in 2022-23. There is of course still more to be done, which is why we are investing £900 million to reduce that figure still further by £2.4 billion by 2024-25.

Mark Fletcher: During the pandemic, the Government rightly got support out to people as quickly as possible, but that inevitably meant that errors were made and some people took advantage of the situation. What is being done to clamp down on fraud and errors in universal credit?

Mel Stride: A huge amount, including the targeted case review, which over the next five years will review hundreds of thousands of universal credit claims to look for fraud and error. Of course, we use emerging new technologies for that purpose as well.

Jim Shannon: I thank the Secretary of State for that answer. I absolutely support the principle that those who carry out benefit fraud must be made accountable, but what I find in my office—I think that others in the Chamber will probably find this as well—is that many people have filled in an application form, document or review and inadvertently ticked the wrong box. By doing so, they have left themselves in a very difficult position where they find that they have to make a repayment. Sometimes people need help at the initial stages to ensure that they get it right. What can be done to help those people so that they do not get into debt that they did not expect to be in?

Mel Stride: There is help within jobcentres. There is also Citizens Advice, and a help to claim process available there. When people make genuine errors and when they have been overpaid for various reasons, we are of course sympathetic, to ensure that we do not put them in a position where it is incredibly difficult for them to repay those amounts.

Labour Market Inactivity

Rachel Hopkins: What assessment his Department has made of the adequacy of its policies on reducing the level of inactivity in the labour market.

Mel Stride: We are doing a great deal to bear down on economic inactivity. As of August this year, the figures show that over half the increase in economic activity that occurred during the pandemic has since unwound. That is more than 300,000 people into work.

Rachel Hopkins: The Secretary of State’s comments suggesting that unemployed over-50s should consider becoming delivery riders clearly show that the Government are failing to help older workers into stable employment. Rather than glorifying precarious work in the gig economy, will he commit to rolling out a plan that gives older workers the dignity, respect and support they deserve to rejoin the workforce?

Mel Stride: I think it is very unfortunate when any Member of this House looks down on a certain category of job that is employing hundreds of thousands of people perfectly satisfactorily. In fact, in that interview I said:
“I think as a department we shouldn’t be prescriptive,”—
referring to the over-50s—
“so we’re not here to start pontificating about whether people should or should not go back into work”.
Hopefully that has put the record straight. We are doing a huge amount to support those over 50 who have retired prematurely, including the midlife MOT, returnerships and the tax changes we have made around pensions,  and we will continue to support people. That is why we are seeing those inactivity rates above 50 declining quite strongly.

Jonathan Gullis: Sickness and sick pay are an anchor when it comes to getting people back into work, as well as helping to grow the economy. That is why the Centre for Progressive Change produced an excellent report that has support from Members across this House. Will my right hon. Friend therefore meet me and my right hon. Friend the Member for Witham (Priti Patel), who has also supported it, to look at the proposals made, so that we can really help to improve sick pay—something that has the backing of 75% of British businesses?

Mel Stride: I would be very happy for either myself or the relevant Minister to meet my hon. Friend or my right hon. Friend the Member for Witham (Priti Patel).

Lindsay Hoyle: I call the shadow Minister.

Karen Buck: We all want to see both unemployment and economic inactivity as low as possible, but the Office for National Statistics, quoted approvingly by the Minister a few minutes ago, reports that this spring’s quarter showed a large fall in the number of people moving from economic inactivity into employment, and that the net movement from employment to economic inactivity was the largest since the covid autumn of 2020. Given that this is the Department’s priority, what assessment has he made of why this is going wrong?

Mel Stride: My assessment of economic inactivity is that it is falling; it has fallen by around 350,000 or more since its peak during the pandemic. That leaves us below the average rate of economic inactivity across the G7, the European Union and the OECD. We are making real progress and will continue to do so.

Unsuccessful Benefit Decisions Overturned on Appeal

Kerry McCarthy: What estimate his Department has made of the number and proportion of unsuccessful benefit decisions that were overturned on appeal in the last 12 months.

Tom Pursglove: Our aim is to make the right decision as early as possible in a claim. In 2022-23, there were 80,000 social security and child support appeal tribunal hearings, with 50,000 overturned. We recognise that the overturn rate at appeal is high. However, the numbers must be seen in the context of overall decisions. The majority of appeal tribunal hearings relate to PIP. Since PIP was introduced, 8% of initial decisions have been appealed and 4% overturned at a hearing.

Kerry McCarthy: The Minister is being very selective in his use of statistics. The most recent tribunal stats show that an increasing number of cases, the vast majority, are being overturned—something that is certainly borne out by my constituents contacting me. Why are we not getting it right first time? Surely it is a huge waste of resources to be taking so many cases to tribunal?

Tom Pursglove: There is no advantage to anybody in the right outcome not being achieved at the very earliest point. The hon. Lady asks why we often see tribunals reach different decisions. There are a number of reasons, for example, drawing different conclusions on the same evidence, cogent evidence being presented orally within those tribunals, or even perhaps written evidence being provided at the hearing that has not previously been shared. We are taking steps, including having presenting officers feed back to the Department, to ensure that more decisions are got right at the first opportunity.

Social Mobility: Young People

David Evennett: What steps his Department is taking to improve social mobility among young people.

Eddie Hughes: What steps his Department is taking to improve social mobility among young people.

Mims Davies: Every day, our work coaches help people of all ages and all backgrounds to overcome barriers, build their confidence and move into and progress in work. For young people, we have specialised support via the DWP youth offer. We have extended our Jobcentre support for people in work and on low incomes, helping them to increase their earnings, to move into better-paid, quality jobs and to improve their prospects through in-work progression. We are also providing additional work coach time and boosting the skills support, meaning that we are truly opening up opportunities for all.

David Evennett: I welcome my hon. Friend’s strong commitment to social mobility, and I share her approach. However, what are the Government doing to ensure that young people in my constituency of Bexleyheath and Crayford have the jobs that they need and greater opportunities to succeed?

Mims Davies: I agree and am determined to ensure that everyone, regardless of their background or postcode, can succeed in Bexleyheath and Crayford and beyond. As part of the DWP youth offer, we have a youth hub serving my right hon. Friend’s constituency, working in partnership with YouthBuild Ventures, to help young people to build their confidence with tailored wraparound support and to move into local jobs.

Eddie Hughes: Degree apprenticeships are a great way for those who are socially less well off to get into employment and avoid the costs associated with getting a degree through other routes, so what steps is the Minister taking to help more people achieve that ambition?

Mims Davies: I agree that it is key that young people get the right opportunities to progress, thrive and move into long-term sustainable work. Apprenticeships are crucial in driving growth and social mobility. They boost business skills and improve people’s earnings and progression opportunities. My hon. Friend will be pleased to see a new youth hub open in Walsall shortly, and that  our work coach has been working with Walsall College on place-based tailored employability support for his area.

Tim Farron: The biggest bar to young people finding employment in the lakes and the dales is the fact that there is nowhere affordable for them to live—average house prices are 12 times average incomes, and the long-term rented sector has collapsed into the Airbnb sector. Will the Minister make the Lake district and the Yorkshire dales special pilot areas to ensure that the only homes we build there are affordable ones for people who will make their lives there, work and contribute to our economy, so that we do not run out of workforce?

Mims Davies: I think we can agree on one thing: the hon. Gentleman’s area is a very special one. In the meantime, we have recruited at the DWP 37 progression leads who will work locally with employers and jobcentres to sort that progression and retention challenge, but I think some of his questions are for a different Department.

Employment: North Devon

Selaine Saxby: What steps his Department is taking to increase employment in North Devon constituency.

Guy Opperman: The Jobcentre teams in North Devon are working day and night to fill the vacancies in my hon. Friend’s constituency. That includes inviting employers into the Jobcentre Plus each week, and having upcoming events on sector-based work academy programmes, including one that is about to happen with the NHS trust in Barnstaple.

Selaine Saxby: Unemployment in North Devon is well below the national average due to the high proportion of retired people and a lack of homes those working can afford. Businesses and the public sector alike are reporting high vacancy levels. What steps is my hon. Friend taking to ensure that we do not see further business closures because of a lack of homes that workers can afford?

Guy Opperman: I visited North Devon in April to meet my hon. Friend and discuss those issues. She has my full support and that of the Department in her work to ensure that we address those problems. Clearly, those matters are being addressed on an ongoing basis by the Department for Levelling Up, Housing and Communities, but I can assure her that she has my full support.

Workplace Sickness Absence

Rachael Maskell: What steps his Department is taking with Cabinet colleagues to help reduce sickness absences in the workplace.

Mel Stride: Sickness, and supporting those who are sick in the workplace, is an important focus for the Department, which is why we are consulting on occupational health and ensuring that more businesses take it up as something to offer their employees.

Rachael Maskell: Seventeen million working days are lost every year because of negative workplace cultures and staff wellbeing. That is partly down to bullying, which is prevalent across many workplaces. What steps is the Secretary of State taking to consider workplace cultures, particularly bullying at work, and will he meet me to discuss my bullying and respect at work Bill, which would put a recourse into law?

Mel Stride: Like the hon. Lady, I and my ministerial colleagues take bullying in the workplace extremely seriously. There is no place for that in our country. I would be very happy for her to have a meeting with the relevant DWP Minister.

High Income Child Benefit Charge:  Gender Pension Gap

Wendy Chamberlain: What assessment he has made of the potential impact of the high income child benefit charge on the gender pension gap.

Laura Trott: In April, we announced plans to address this issue by introducing a retrospective national insurance credit, which will ensure that more people—especially women—have the opportunity to obtain a full state pension.

Wendy Chamberlain: The high income child benefit charge is potentially a scandal waiting to happen. Currently, families have to apply for a benefit they know they are not entitled to so that the stay-at-home parent—usually the mother—gets the national insurance credits that they need for her state pension. It is good to hear that the Government are doing something, but they need to reform the process further. Will they agree to at least put some comms in? I certainly had not heard of the changes in April.

Laura Trott: I am glad that the hon. Lady agrees with those changes. I assure her that we will be bringing them forward as soon as we can.

Topical Questions

Alexander Stafford: If he will make a statement on his departmental responsibilities.

Mel Stride: May I begin by welcoming my new opposite number, the hon. Member for Leicester West (Liz Kendall), to her post? I know she will agree that it is an honour and a privilege to be associated with this Department, whether on the Opposition Benches or the Government Benches, and the very important mission of looking after the most vulnerable, which I know we both share. I look forward to a constructive engagement with her in the weeks and months to come.
My Department continues to focus on supporting the most vulnerable through cost of living payments, pension credit and the benefits system more generally; bearing down on fraud and error; and promoting work and, in particular—as we have been discussing—reducing economic inactivity.

Alexander Stafford: Will the Secretary of State join me in welcoming the recent decision on the national disability strategy, which allows us to get on and improve the lives of so many disabled people?

Mel Stride: I thank my hon. Friend for his question. I very much welcome the Court of Appeal’s decision in July, meaning that the national disability strategy is lawful. The Government are now able to continue with the important work of implementing that long-term strategy, and I can confirm that my hon. Friend the Minister for Disabled People will shortly come forward with further details of some of the individual commitments we will be making around that strategy.

Lindsay Hoyle: I welcome the shadow Secretary of State to her position.

Liz Kendall: Thank you, Mr Speaker, and I thank the Secretary of State for his kind words. However, whatever he says about economic inactivity, it remains a serious problem in this country, with the UK lagging behind all other G7 countries in terms of workforce participation since the pandemic. Indeed, last month, the number of people off work due to long-term sickness hit an all-time high. What is this Government’s response? The Chancellor tells the over-50s to get off the golf course, and the DWP Secretary tells them to literally get on their bike. Is not the truth that this Government’s failure to cut waiting lists, sort social care and have a proper plan for reforming our jobcentres is harming individuals and our economy as a whole?

Mel Stride: To the extent that the hon. Lady was suggesting that economic inactivity was worse in our country than in all other economies, or all similar economies—I think that is what she said—that simply is not the case. It is true that economic inactivity spiked during the pandemic; none the less, as I said earlier, the average rate is lower than the average across the OECD, the EU and the G7.
The hon. Lady mentioned those who are long-term sick and disabled. That is why we are bringing forward pilots such as WorkWell and rolling out universal support, to make sure we bring the world of work together with the world of health, to the betterment of those who we look after.

Liz Kendall: This is not just about the over-50s. Is the Secretary of State aware that the biggest relative jump in economic inactivity due to sickness is among young people, with mental health being the biggest concern? Labour has a plan to transform mental health in this country, paid for by closing private equity loopholes. When will this Government act and put a proper plan in place?

Mel Stride: There is a proper plan in place. I invite the hon. Lady to spend some time looking more closely at the announcements that have been made, particularly at the time of the last fiscal statement, and especially those about WorkWell, universal support, and the work we are doing with the national health service and other agencies to make sure—as I say—that we bring together the world of work and the world of health and provide support, particularly for those with mental health conditions.

Nigel Mills: The Health and Safety Executive website currently makes no mention of the aerated concrete issue that we all heard about at the end of last week. Can we be assured that the Executive has the resource and motivation to get that guidance out there, so that employers and other building owners know what they should be doing in this situation?

Mims Davies: The HSE’s focus has been on raising awareness of RAAC—reinforced autoclaved aerated concrete—through its engagement and stakeholder groups via the public sector, and this was actually raised in a bulletin back in April 2021. I will look into the point my hon. Friend has made, but I am certain there has been clear guidance to those who need it.

Liz Twist: Thousands of women who have been underpaid their state pensions due to departmental mistakes will be forced to wait until the end of 2024 to see this error addressed. Does the Minister really think this is acceptable?

Laura Trott: The hon. Lady asked about this last time, and I believe I informed her previously that all alive people will be receiving the benefits they are entitled to by the end of this year.

Theresa Villiers: What action are the Government taking to deal with the difficulties that many disabled people face with accessing the support they need? In particular, has there been a move back to making face-to-face contacts part of the assessments and decisions in the benefit system?

Tom Pursglove: We have made available a diversity of assessment channels to people, but the key point is that anybody who wants to have a face-to-face appointment is able to have one. They can request one and that will be facilitated, and I think that is important. Jobcentres will be at the leading edge of delivering on our new supported employment programme—universal support—and we have WorkWell coming on stream as well. We do not want to write anybody off. Where people want to work or to try to work, we should be supporting that wherever we can, and that is precisely what we are all about.

Dan Carden: A constituent of mine has cerebral palsy, a lifelong condition for which there is no prospect of improvement and which affects her mobility and balance. Despite this, she has faced repeated unnecessary and inaccurate reassessments for the personal independence payment, and she lost her PIP mobility after the most recent assessment. The DWP justifies its decision by saying that it was advised that her last fall was over three months prior to the consultation. What kind of system demands that people with lifelong conditions regularly have to hurt themselves to receive the support they are entitled to?

Tom Pursglove: I would obviously want to see the details of the case in question before commenting on it, so perhaps the hon. Member could kindly share those  details with me. One of the things we are focused on is getting to a place where people with conditions or disabilities that are unlikely to improve or are only likely to deteriorate are not having to go through repeat assessments. That is the objective we are working towards through the White Paper reforms. [Interruption.] I hear a lot of chuntering from the Opposition. I would be absolutely delighted if they would get on and support our reforms so we can make those improvements.

John Penrose: Universal credit has been hugely effective in making sure it always pays to work, but for jobseekers with no savings who used to be paid daily or weekly the five-week wait for their first payment can plunge them into debt, whether it is a DWP advance or other loans. Will Ministers consider the proposals in “Poverty Trapped” for initial payments to be made at the same daily or weekly frequency as a jobseeker was previously paid, so they can focus on finding a job rather than juggling their debts?

Guy Opperman: I can tell my hon. Friend that there are no plans to change the assessment period and payment structure of universal credit, but I am very happy for him to sit down with officials and discuss his paper.

Alex Davies-Jones: A constituent battling multiple sclerosis recently came to one of my surgeries after his PIP application was refused without ever receiving a face-to-face assessment—and he did request one. The automated letter dismissing his appeal used incredibly insulting and derogatory language. Without ever meeting him, the Minister’s Department declared my constituent fit and able despite this clearly not being the case. I am doing whatever I can to support my constituent, but surely the Minister will agree that PIP applicants deserve face-to-face assessments rather than this dismissive, humiliating letter language.

Tom Pursglove: If people wish to have a face-to-face assessment, they ought to be able to have one—that is the position. There are claimants for whom a different form of assessment—a telephone assessment or a virtual assessment—is more appropriate and is perhaps what they want, but that choice should be available to people, and providers should be facilitating that. Again, if the hon. Member would kindly share the details of that case with me, I will look at it as a matter of urgency.

Simon Jupp: I warmly welcome the considerable progress this Conservative Government have made in supporting pensioners. The triple lock and targeted support with the cost of living are welcome in my part of Devon. Will my hon. Friend outline how this Conservative Government will ensure that this great progress continues?

Laura Trott: The triple lock was a Conservative invention. It was a pledge in our manifesto and the Secretary of State will be looking at it again this year when he makes his decision on benefits.

Debbie Abrahams: In 2016 the United Nations committee responsible for monitoring the UN convention on the  rights of disabled people published a damning report that found that the Government had systematically discriminated against disabled people, in breach of their rights. Last week the UN committee reviewed evidence describing the further deterioration of disabled people’s circumstances and rights since 2016, but the Government refused to attend. Isn’t this just another kick in the face for disabled people?

Tom Pursglove: I do not accept the hon. Lady’s characterisation of the situation. We have followed all of the committee’s procedures; we are engaging with this process in good faith and will present our progress at the session in March 2024. [Interruption.] It is rather frustrating that the hon. Lady often gives the impression that this country is not a world leader on disability issues. The Equality Act 2010, for example, is the cornerstone of ensuring equalities legislation, and we also have the British Sign Language Act 2022 and the Down Syndrome Act 2022. We have also taken other steps forward, and we should be supporting that.

James Sunderland: I am fortunate to represent a part of the country that is blessed with near-full employment. However, businesses in Bracknell and beyond struggle to recruit enough staff. Can the Secretary of State reassure me that his Department will leave no stone unturned in getting as many people as possible back into the workplace?

Guy Opperman: I welcome the good news but also accept the challenge. I have visited Bracknell to meet my hon. Friend and am happy to sit down with him and the local jobcentres to ensure we are addressing his constituency’s vacancy issues.

Mike Amesbury: Last week I met the citizens advice bureau in Cheshire west and Chester, which informed me that 75% of those who appeal their PIP assessments win. Why does the Minister not get it right in the first place, and what is he doing, at pace, to address that?

Tom Pursglove: I am very appreciative of citizens advice bureaux around the country for all the work they do in supporting constituents in each of our constituencies. In the interests of time, I will just refer the hon. Gentleman back to the points I made earlier about the steps we are taking.

Aaron Bell: The recent changes to access to means-tested benefits for those in receipt of vaccine damage payments are very welcome, and I thank the Minister for his engagement. Will he join me in paying tribute to those who campaigned for that change in the law, including my constituent Sheila Ward?

Guy Opperman: I pay full credit to Mrs Ward and also to my hon. Friend. I read with interest the Stoke Sentinel report on this particular issue. There is a genuine change to be made, there has been a long-standing campaign, and all parties should be pleased with the outcome reached.

Jamie Stone: In all honesty, I probably ought to declare an interest, but pensioners living in Edinburgh and Glasgow do not face the same sorts of increases as pensioners  living in a remote and faraway constituency such as mine when it comes to living costs such as running a car, buying groceries and heating the house. Will the Government look at ways of targeting these particularly hard-hit people?

Mel Stride: We of course look at particularly targeting harder-hit pensioners through pension credit, and the Pensions Minister, my hon. Friend the Member for Sevenoaks (Laura Trott), has done a huge amount to promote that. But we are always open to receiving further ideas and having discussions, and if the hon. Gentleman would like to come forward with further ideas, we will certainly look at them.

Taiwo Owatemi: I have been contacted many times each month by parents left seriously out of pocket by their ex-spouses’ failure to pay child maintenance owed. What steps are the Government taking to ensure parents are able to receive their child maintenance on time so that many families are not left subjected to coercive control by their ex-spouses or left out of pocket?

Mims Davies: I thank the hon. Lady for making those points. Child maintenance payments keep about 160,000 children out of poverty each year and are absolutely  vital. They play a key role in ensuring both parents play their part in supporting their children whether or not they live with them. If the hon. Lady has particular cases or interests, I am happy to meet her.

Alison Thewliss: A constituent of mine has a small work pension, rendering her ineligible for pension credit yet still struggling to get by. Another constituent who is 80 and misses out on pension credit by just £10 has contacted me several times angry and hurt that he now has to pay for his TV licence. Will Ministers review the rules on pension credit, because ineligibility for so many of the passported benefits leaves many of my constituents out of pocket? They want to be eligible for it but are not.

Laura Trott: Obviously this is without looking at the individual case, but it is important to note that the threshold has gone up significantly, so it is worth questioning whether the hon. Lady’s constituents are now eligible. If not, applications to the household support fund can be helpful, and local councils may be able to offer housing benefit support. If there is an individual case that she would like to write to me about, I am happy to respond.

Lindsay Hoyle: That completes the questions. Those who wish to leave should do so.

Police Service of Northern Ireland: Security and Data Protection Breach

Lindsay Hoyle: Before I call the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson) to ask the urgent question, I wish to make a short statement about the sub judice resolution. The matter of the data breach is not sub judice, but I have been advised that an individual has been charged with terrorism-related offences following the data breach. While I am content to waive the sub judice resolution in this and other proceedings to allow simple reference to the fact of the arrest, any further discussion of the circumstances of that case would not be in order.

Jeffrey M. Donaldson: (Urgent Question): To ask the Secretary of State for Northern Ireland if he will make a statement on the breach of security and data protection at the Police Service of Northern Ireland.

Chris Heaton-Harris: I thank the right hon. Gentleman for his urgent question. As you know, Mr Speaker, I was keen to do a statement on the Police Service of Northern Ireland’s data breach on 8 August, so I am pleased to have this opportunity. I am also happy to provide an update to the House on this matter. However, since writing this answer, and as the right hon. Gentleman will know, news of the PSNI’s Chief Constable’s resignation has broken over the past few minutes. I thank Simon Byrne for his years of public service. The right hon. Gentleman will know that the appointment of a new Chief Constable is a matter for the Northern Ireland Policing Board, and I will continue to liaise with the senior management team of PSNI while the process of appointing a successor gets under way. The PSNI continues to have my and the Government’s full support in responding to the data breach, and we are focused on providing appropriate and proportionate data and expertise.
The breach, where the personal information of more than 10,000 officers and staff was accidentally published in what appears to be a human error involving a number of spreadsheet fields, happened on 8 August. Not realising that the relevant document contained a hidden table, the initials and surnames of every rank and grade, the location where an individual was based—but not their home address—and their duty type were published online for approximately three hours. The data breach is deeply concerning and significant. Recent events in Northern Ireland, including the terrible attack on Detective Chief Inspector John Caldwell, show that there is still a small minority in Northern Ireland who wish to cause harm to PSNI officers and staff in Northern Ireland. I take this opportunity to thank all those individuals who work to keep the people of Northern Ireland safe. They have my many thanks, and we all owe them our gratitude.
I recognise, too, that there is significant concern about the consequences of this data breach. Many PSNI officers and staff have raised concerns about themselves and their families, and they have my support and understanding as they go about their important work, keeping communities safe in these worrying and most testing of circumstances. To them, I again say thank you.
In response to these concerns, the PSNI and wider security partners are taking appropriate action and are working around the clock to investigate the incident, provide reassurance and mitigate any risk to the safety and security of officers and staff. As of 30 August, 3,954 self-referrals have been made to the PSNI’s emergency threat management group. That is part of the welfare and support services that have been made available to PSNI officers.
The House will understand that the PSNI is devolved and has operational independence. That has been the case since April 2010 with the creation of the Department of Justice. However, as the House would expect, the Government have remained in close contact with the PSNI since this breach and other data breaches came to light. My officials and I have been receiving regular updates and the Government’s focus has been on providing specialist support and expertise to the PSNI in its handling of this issue. Officials in the Cabinet Office have chaired—[Interruption.] I will finish in a second, Mr Speaker. Officials in the Cabinet Office have chaired regular meetings, and I will update the House further, hopefully during this urgent question.

Jeffrey M. Donaldson: Thank you, Mr Speaker, for the opportunity to raise the plight of police officers and staff in Northern Ireland. The industrial-scale breach in data last month was yet another self-inflicted blow to the morale of the police service, as well as to confidence in policing across Northern Ireland. For the rank and file, and for the staff working in our police stations, for their personal details to be released into the public domain and to find their way into the hands of dissident republicans is unforgivable.
The current terrorist threat level in Northern Ireland is “severe.” Just a few months ago, Detective Chief Inspector John Caldwell was barbarically attacked by gunmen in front of his young son after coaching an under-15s football team near Omagh. Now, each one of his colleagues must come to terms with the fact that they and their families have potentially been placed in harm’s way by the release of this data.
It goes further than that. Last week’s ruling by Mr Justice Scoffield found that the PSNI’s senior command unlawfully disciplined two of its own officers in order to appease Sinn Féin. These actions are hugely damaging to community relations, to community confidence and to confidence in the rule of law in Northern Ireland. Fair and even-handed policing is just as foundational to progress in Northern Ireland as is fully functioning political institutions operating on a cross-community consensus basis. We therefore need to hear from the Government that they will ensure that the necessary resources are available to the police—notwithstanding budgetary constraints—so that police officers, their families and police staff are properly protected against terrorist attack.
Furthermore, the Democratic Unionist party welcomes the decision by the chief constable to announce his resignation. We believe that is the right thing to do in all the circumstances. Now we want to see confidence rebuilt in our police service, and we will work with the PSNI—it has our full support—to achieve and deliver effective and efficient policing for everyone in Northern Ireland in a way that commands cross-community support.

Chris Heaton-Harris: I thank the right hon. Gentleman again for the urgent question and for the various questions he has posed. Officials in the Cabinet Office have chaired regular operational meetings—initially daily—bringing together the PSNI, Government Departments and our world-class security services to ensure that all their collective skills, including cyber-expertise, have been brought to bear in supporting the PSNI on the breach.
You will appreciate, Mr Speaker, that given your ruling on sub judice and for security reasons, I cannot comment on specific details of the response, but six individuals have been arrested by detectives investigating the breach and the criminality connected to it. Five have been released on bail to allow for further police inquiries and one has been charged with possessing documents or records likely to be useful to terrorists, and another item.
The right hon. Gentleman mentioned money. The response to such a significant breach will obviously come with a cost. The UK Government are clear that security is paramount, and the focus remains on support and expertise at this point. With Northern Ireland’s policing being devolved, it is for the Department of Justice to set its budget and ensure it can fulfil its duties and responsibilities, but it still remains a fundamental responsibility of the Executive—in their absence, Northern Ireland Departments—to run a balanced and sustainable budget. Where additional funding is required, the correct process, which includes a whole host of different things, must be followed. However, I completely understand the right hon. Gentleman’s point.

Theresa Villiers: This whole episode is agonising. I want to put on record my support and sympathy for all those brave men and women of the PSNI who fear for their security and that of their families as a result. I urge the Secretary of State to do everything possible with the PSNI to ensure that documents of this sensitivity are subject to sufficient protection so that a mistake of this sort can never ever be made again.

Chris Heaton-Harris: I think that the right hon. Member for Lagan Valley (Sir Jeffrey M. Donaldson) referred to it in his question as a “self-inflicted” wound, and it surely was. To be frank, checks and balances should have been in place. I completely agree with my right hon. Friend, and we will do what we can to assist the PSNI and the Department of Justice, as she would expect. We keep abreast of these matters, as I hope I detailed in my answers, but this is a really significant breach. As one police officer put it to me, “When I joined the police service, I used to think when I went to work that maybe people knew what I did for a living, but now that has completely flipped—I feel that they absolutely know what I do for a living.” That has changed the psychology around the whole piece. I know that a lot more assurances need to be given for us to get to the place that my right hon. Friend wishes to get to.

Lindsay Hoyle: I welcome the new shadow Secretary of State.

Hilary Benn: May I say that I look forward to working with the Secretary of State in the interests of peace, prosperity and progress in Northern Ireland?
The release of the names and workplaces of thousands of PSNI officers and staff was doubtless inadvertent, but its consequences could not be more serious. That has now been recognised by the chief constable, Simon Byrne, who is resigning—I join the Secretary of State in thanking him for his service. Those who serve in the PSNI confront great risks every day in their job to keep the public safe, and we thank them. But they already knew that dissident republicans were targeting them and their families, and now they know that those who would do them harm have this list. The damage to morale and confidence should not be underestimated. They are asking urgently, “What will be done to reassure and protect us?”
Does the Secretary of State agree that the inquiry needs to be completed as quickly as possible? Can he confirm that he will approve the appointment of the new chief constable in the absence of a Justice Minister in Northern Ireland? Does he intend to review the operation of the Northern Ireland Policing Board and how it functions? Does he recognise that there will be additional costs in protecting staff, as well as responding to potential civil claims? There were already great pressures on the Northern Ireland policing budget, and the cuts it now faces will, in the words of the PSNI, leave the service “smaller…less visible, less accessible and less responsive”.
Finally, the whole House wants to ensure that the staff get the support, protection and reassurance they need, but to succeed in doing that we need leadership from the Government and the political parties in Northern Ireland, to get the Assembly and the Executive up and running again as quickly as possible.

Chris Heaton-Harris: I welcome the right hon. Gentleman to his place and look forward to working with him. As I mentioned outside the Chamber, I will happily brief him on any aspects and will arrange technical briefings from my officials so that he can be brought up to speed quickly. I would like to put on record my thanks to the former shadow Secretary of State, the hon. Member for Hove (Peter Kyle), who is present, for the way he went about his business and for the very co-operative way we dealt with business. I appreciate it and wish him well as we move forward.
The right hon. Gentleman asked about the inquiry. Yes, it needs to be expedited. A timetable has been set up by the Policing Board, which is independent, and I believe that it reports in three months’ time. It is quite a fundamental inquiry, and I hope in that time it will be able to bring all the answers required to the table. He asked about the appointment of a future chief constable; if the institutions of the Executive and the Minister for Justice are not present, we will have to pass secondary legislation in this place to allow that to happen. All that depends on the Policing Board going about its business and recruitment—I believe that is very much a rubber stamp of its work.
The right hon. Gentleman asked about the Policing Board and reform. I spoke to a number of board members before the resignation of the chief constable, and they all know that the spotlight is on them and how they deal with this. I would like to wait and see how they discharge their duties over the course of the next few weeks before I commit to reform, because there are good people there who have the ability to do the job.
Finally, on the budget, which I mentioned in my answer, the right hon. Gentleman forgot to mention that the Information Commissioner will come out with a decent fine for the data breach. We will have to take a whole host of things into account. As and when they materialise, we will look at them.

Shailesh Vara: The Secretary of State mentioned the independence of the PSNI, and that funding issues lie with the Department of Justice and the Northern Ireland Executive, but may I press him on this issue? Will he use his considerable influence to ensure that the safety of all people is first and foremost, and not the cost? It is important that the influence he has is exerted to its fullest, because these are good people who find themselves in a very, very difficult position through no fault of their own.

Chris Heaton-Harris: I like to feel that I have considerable influence in Government, but I am not sure that is completely correct. However, I will use the influence I have to do the right thing by all those who work for the PSNI. All sorts of issues have come up over the past 25 years and since policing was devolved, but policing in Northern Ireland certainly seems to look and feel better, and it is beginning to get good outcomes for those who are being policed. I can only praise the officers and say that I will do everything in their support.

Lindsay Hoyle: I call the SNP spokesperson.

Richard Thomson: I join the Secretary of State in offering my thanks to Simon Byrne for his service. I believe his decision today, however, is the right one. This represented a shocking breach of confidentiality not just in relation to people’s personal data, but a shocking breach in the confidence that PSNI officers and staff can have in the organisation. I pay tribute to the dedicated PSNI officers and staff who daily protect and serve the people of Northern Ireland.
The PSNI, as has been alluded to, is already suffering a crisis of funding and therefore resourcing. The officer complement is lower than it has been in the police service serving Northern Ireland than at any point since 1979. The UK Government pay £30 million a year in additional funding to meet the security challenge, but that funding was inadequate even before the breach and is surely even more inadequate now. Will the Secretary of State be a little clearer on exactly how he will give funding guarantees to the PSNI going forward, because I do not believe this is something where the buck can be passed entirely to those who are currently charged with administering devolved budgets?

Chris Heaton-Harris: I thank the hon. Gentleman for his question. He talks about the additional security funding that the Government put in. The UK Government’s contribution to the financial year 2022-23 is £32 million in this space. The cost implications of the PSNI response are rightly being discussed with the Department of Justice. Any additional asks for funding would come through an established process. While it would not be right for me to pre-empt that, the Government are clear that security is paramount. Our focus remains currently on the asks that have been made of us, which are to provide specialist support and expertise in response to the latest assessment.

Julian Smith: PSNI officers face significant physical risks, but they also face significant reputational and relationship risk when they are revealed to be members of the PSNI. The Catholic Police Officers Guild and the Police Federation for Northern Ireland have done brilliant work over the past few weeks. Will the Secretary of State confirm that he is engaging with those organisations as the Government seek to support the impact of the breach?

Chris Heaton-Harris: I have not yet spoken to the Catholic Police Officers Guild personally, but my officials have done so on a number of occasions and I am very happy to do so. Initially, we were receiving high-level briefings from the chief constable and his senior management team, and, as I mentioned, the Cabinet Office committee that was set up was receiving and imparting information at an officer level. We are at the beginning of the process, so there is still a very long way to go. The PSNI will have to reflect on today’s news of the chief constable’s resignation. There is a lot more for the Government and the Secretary of State to do in this space, and I fully recognise that.

Colum Eastwood: I think that Simon Byrne has made absolutely the right decision in resigning today, given everything that has happened in recent weeks. However, there is a much deeper and more significant problem than just one individual, and it is one about which we have been warning for years: the real crisis in the recruitment and retention of Catholic PSNI officers and staff. Does the Secretary of State agree that the best way of dealing with that crisis is to bring back 50:50 recruitment?

Chris Heaton-Harris: During a conversation I had with the hon. Gentleman last week, he talked about the Patten reforms and 50:50 recruitment, and said it had been a backward step to depart from that point. I am a great believer in the original principle of policing, in Peelism, whereby a police force reflects the community that it polices. That is how it gains its confidence. I may be mistaken, but I think I was briefed recently that there had been good levels of recruitment to the PSNI from Catholic communities, but situations such as the one we are discussing today damage the prospects of that continuing, and it is our job—the job of all of us—to ensure that that does not happen.

Robert Buckland: If anyone was in any doubt about the particularly difficult and sensitive role played by police officers in Northern Ireland, they should not be in any doubt now following this appalling incident. Has my right hon. Friend been satisfied thus far that within the PSNI, suitable measures have already been taken to ensure that freedom of information and subject access requests are dealt with by people of sufficient seniority, and that there is vetting and double-checking of information before it is disclosed into the public domain?

Chris Heaton-Harris: I thank my right hon. and learned Friend for his wise question, and I can give him that assurance. The processes behind the issuing of freedom of information answers have been very well checked and will, I am sure, be checked and checked  and checked again—and, I believe, simplified, with much more senior eyes making sure that information goes out correctly.

Karin Smyth: I was in Northern Ireland during the week after the breach, and the fact that officers continued to go out and go about their duties is a testament to them and their service. However, it is unacceptable that the job they do remains a secret from many people, and that we somehow think this is normal in Northern Ireland 25 years after the peace process; it would not be normal in any other part of the United Kingdom, or in Ireland. What is the Secretary of State doing with the co-guarantors of the peace process, the Irish Government, and those in the field more widely to deal with what is now clearly a crisis?

Chris Heaton-Harris: I personally agree entirely with the first part of what the hon. Lady has said. Policing should be much more normalised in Northern Ireland, as, indeed, life should be. However, there is an interesting, rich and troubled history in Northern Ireland that has led us to where we are now. What the Chief Constable did in introducing community policing means that the hon. Lady will be able to walk around all sorts of places and have the sense of a much more normal policing experience.
I have had conversations with my Irish counterparts, although this is very much an issue that rests with the UK Government, but everyone is interested in how freedom of information requests are now dealt with.

Stephen Farry: I, too, thank Simon Byrne for his service, and join others in recognising that in the current circumstances he made the right decision in resigning, given that his position was no longer tenable. On the issue of the data breach, can the Secretary of State assure the House that money will be no obstacle in the short run when it comes to the relocation of any officer? There will be people, particularly those from a Catholic nationalist background who are operating in intelligence and highly sensitive security roles, who are particularly exposed, alongside everyone else who is at risk. Can the Secretary of State assure us that there will be no barriers to ensuring their safety, which is paramount?

Chris Heaton-Harris: I must be careful about how I answer that question, because it relates very much to security matters, but I think I can say that the hon. Gentleman is correct in assuming what he assumes.

Meg Hillier: I am heartened by the Secretary of State’s commitment to money and support for his officers, although money cannot put this right. Ministers come and go, as do Governments, so will he also commit himself to giving regular and confidential updates to, perhaps, the Intelligence and Security Committee or the Northern Ireland Affairs Committee on the ongoing costs? There is a danger that while there is a long-term risk for officers, short-term Government thinking can mean that support of this kind can wither on the vine.

Chris Heaton-Harris: I will happily find out the appropriate way of reporting, as the hon. Lady suggests. As I have said, I think this is going to have a very long tail, so the ramifications as it plays out will ripple through the system for a very long time indeed.

Gavin Robinson: On behalf of my colleagues, I welcome the new shadow Secretary of State to his place. I look forward to working with him. I also thank his predecessor for all his efforts to engage with us.
It is important to correct a number of inaccuracies in the Secretary of State’s response. There was no hidden table but, as is common with Excel spreadsheets, there was more than one field. There was human error, but there were five levels of security to assess what was going out, all of which failed. That speaks to systemic failure within the PSNI. I welcome the resignation of the Chief Constable this afternoon and I think it is important that collectively—politically and in society—we all work together. I hope the Secretary of State will support us in this to instil confidence again in the Police Service of Northern Ireland.

Chris Heaton-Harris: I did not know that the hon. Gentleman was such an expert in Excel. I am certainly not, so I am happy to be corrected by him on the detail of that, but I think my statement was pretty thorough and I agree with what he says.

Jamie Stone: As some Members will know, my wife comes from County Armagh. We got married at the height of the troubles—the bombings and the shootings—and it sent a chill down my spine when I read of this leak. First, the hon. Member for Foyle (Colum Eastwood) has referred to the difficulty of recruiting to the Police Service of Northern Ireland, and this will only make it worse. Secondly, it will not do much for our relationship with the police in the Republic of Ireland. The danger is that we just say that this is a matter for the PSNI and take a view from across the Irish sea, but Northern Ireland is a constituent part of the United Kingdom and I hope that a United Kingdom solution will be sought involving police forces on this side of the Irish sea and, if necessary, the UK’s intelligence services to find out what happened.

Chris Heaton-Harris: The hon. Gentleman is absolutely correct. That is why I detailed the meetings of officials in the Cabinet Office, who have chaired a large number of regular operational meetings bringing together the PSNI, Government Departments and world-class cyber-security experts to ensure that all our collective skills across the Union are galvanised in this space.

Sammy Wilson: I welcome the resignation of the Chief Constable. It is a pity it took so long. I think he saw that the writing was on the wall when he knew a motion was going to the Policing Board calling for his resignation, and so he should. He has lost the confidence of officers, not just because of this data breach but because he was prepared to throw two junior officers to the wolves in order to placate Sinn Féin, and it is right that he should go.
The Secretary of State has been a bit confusing in his answers about money. He says that he recognises there will be considerable expenditure involving the Information Commissioner, mitigation measures, the relocation of officers and so on. On one hand, he says that this will have to come from the Justice Department budget, but on the other hand, he seems to indicate that the Government recognise that there will be additional expenditure for the police. Given that the police are already 600 officers under strength, will he give a commitment that any additional costs as a result of this will not have to come from the existing overstretched budget?

Chris Heaton-Harris: I thank the right hon. Gentleman for his question. I hope he will forgive me for pushing back slightly, but I think I have been particularly clear on this, and all of this could be solved much more easily if there were an Executive in place. I very much hope that that happens.

Claire Hanna: The last few weeks have been hugely damaging to hard-won progress in our still fragile society. Ordinary officers are feeling vulnerable and demoralised, and we are thinking of them and also of the families of the victims of the Sean Graham murders, who have been thrust into a political row that they did not seek due to a heavy-handed response. In the interests of officer morale and impartial policing, it is important that we know, following that Ormeau Road incident, who in the Northern Ireland Office spoke to the Chief Constable and, when the issue came up of Sinn Féin withdrawing from the Policing Board, what the NIO said to the Chief Constable.

Chris Heaton-Harris: If the hon. Lady would kindly nod to indicate whether she means in the last couple of weeks—[Interruption.] I am afraid I will have to come back to her with that answer, if I may, because I do not have those details.

Jim Shannon: I thank the Secretary of State for his response.
Ever mindful that this is a practical, physical issue for my constituents, will the Secretary of State outline what additional support and help is to be made available to PSNI officers who are under threat and whose families feel unsafe in their homes? Over my 38 years as an elected representative—as a councillor, an Assembly Member and a Member of Parliament—a number of RUC and PSNI officers have come to me in need of assistance after being threatened. That assistance was available fairly urgently. Will the Secretary of State confirm that a budget is available to rehouse, as a priority, those 10,799 police officers and civilian staff who are under threat, taking into consideration those who have moved from one district to another for safety reasons? They feel open and vulnerable to attack, and an apology is simply not enough to allow them to lie safely in their bed at night. What is needed is a practical, physical solution. That is what I am asking for.

Chris Heaton-Harris: I thank the hon. Gentleman for his question, and for the way he puts it. We are currently at a stage where officers and staff who have a concern are reporting it to their senior management, and a triage process has been in place. As of 30 August, 3,954 people have self-referred to the emergency threat management group within PSNI.
If the hon. Gentleman will forgive me, I am very wary of mentioning security matters for those at highest risk, so I will not do so. There is a continuing process to make sure PSNI has both the budget and the process available to ensure that extra security measures can be taken, and to ensure there is extra training and conversations to reassure people. It will be a little while before we see much upward pressure on budgets, and I will then happily update the House.

Countess of Chester Hospital Inquiry

Steve Barclay: With permission, Mr Speaker, I would like to make a statement on the inquiry into the circumstances surrounding the crimes of Lucy Letby.
On 18 August, as the whole House is aware, Letby was convicted of the murder of seven babies and the attempted murder of six others. She committed these crimes while working as a neonatal nurse at the Countess of Chester Hospital between June 2015 and June 2016. As Mr Justice Goss said as he sentenced her to 14 whole life orders, this was a
“cruel, calculated and cynical campaign of child murder”
and a
“gross breach of the trust all citizens place in those who work in the medical and caring professions.”
I think the whole House will agree it is right that she spends the rest of her life behind bars.
I cannot begin to imagine the hurt and suffering that these families went through, and I know from my conversations with them last week that the trial brought these emotions back to the surface. Concerningly, that was exacerbated by the fact the families discovered new information about events concerning their children during the course of the trial.
Losing a child is the greatest sorrow any parent can experience. I am sure the victims’ families have been in the thoughts and prayers of Members across the House, as they have been in mine. We have a duty to get them the answers they deserve, to hold people to account and to make sure lessons are learned. That is why, on the day of conviction, I ordered an independent inquiry into events at the Countess of Chester Hospital, making it clear that the victims’ families would shape it.
I arranged with police liaison officers to meet the families at the earliest possible opportunity to discuss with them the options for the form the inquiry should take, and it was clear that their wishes are for a statutory inquiry with the power to compel witnesses to give evidence under oath. That is why I am confirming this to the House today.
The inquiry will examine the case’s wider circumstances, including the trust’s response to clinicians who raised the alarm and the conduct of the wider NHS and its regulators. I can confirm to the House that Lady Justice Thirlwall will lead the inquiry. She is one of the country’s most senior judges. She currently sits in the Court of Appeal, and she had many years of experience as a senior judge and a senior barrister before that. Before making this statement, I informed the victims’ families of her appointment, which was made following conversations with the Lord Chief Justice, the Lord Chancellor and the Attorney General.
I have raised with Lady Justice Thirlwall the fact that the families should work with her to shape the terms of reference. We hope to finalise those in the next couple of weeks, so that the inquiry can start the consultation as soon as possible. I have also discussed with Lady Justice Thirlwall the families’ desire for the inquiry to take place in phases, so that it provides answers to vital  questions as soon as possible. I will update the House when the terms of reference are agreed and will continue to engage with the families.
Today, I would also like to update the House on actions that have already been taken to improve patient safety and identify warning signs more quickly, as well as action that is already under way to strengthen that further. First, in 2018, NHS England appointed Dr Aidan Fowler as the first national director of patient safety. He worked with the NHS to publish its first patient safety strategy in 2019, creating several national programmes. Those included requiring NHS organisations to employ dedicated patient safety specialists, ensuring that all staff receive robust patient safety training and using data to quickly recognise risks to patient safety. Last summer, to enhance patient safety further, I appointed Dr Henrietta Hughes, a practising GP, as England’s first patient safety commissioner for medicines and medical devices. Dr Hughes brings leaders together to amplify patients’ concerns throughout the health system.
Secondly, in 2019, the NHS began introducing medical examiners across England and Wales to independently scrutinise deaths not investigated by a coroner. Those senior doctors also reach out to bereaved families and find out whether they have any concerns. All acute trusts have appointed medical examiners who now scrutinise hospital deaths and raise any concerns they have with the appropriate authorities.
Thirdly, in 2016, the NHS introduced freedom to speak up guardians, to assist staff who want to speak up about their concerns. More than 900 local guardians now cover every NHS trust. Fourthly, in 2018, Tom Kark KC was commissioned to make recommendations on the fit and proper person test for NHS board members. NHS England incorporated his review findings into the fit and proper person test framework published last month. It introduced additional background checks, the consistent collection of directors’ data and a standardised reference system, thus preventing board members unfit to lead from moving between organisations.
Finally, turning to maternity care, in 2018 NHS England launched the maternity safety support programme to ensure that underperforming trusts receive assistance before serious issues arise. Also since 2018, the Government have funded the national perinatal mortality review tool, which supports trusts and parents to understand why a baby has died and whether any lessons can be learned to save lives in the future. Furthermore, the Government introduced the maternity investigations programme, through the Health Safety Investigation Branch, which investigates maternity safety incidents and provides reports to trusts and families. In 2020, NHS England’s Getting It Right First Time programme was expanded to cover neonatal services. It reviewed England’s neonatal services using detailed data and gave trusts individual improvement plans, which they are working towards. Indeed, Professor Tim Briggs, who leads that programme, has confirmed that all neonatal units have been reviewed by his programme since 2021.
Let me now turn to our forward-facing work. We have already committed to moving medical examiners to a statutory basis and will table secondary legislation on that shortly. It will ensure that deaths not reviewed by a coroner are investigated in all medical settings, in particular extending coverage in primary care, and will enter into force in April.
Secondly, on the Kark review, at the time the NHS actively considered Kark’s recommendation 5 on disbarring senior managers and took the view that introducing the wider changes he recommended in his review mitigated the need to accept that specific recommendation on disbarring. The point was considered further by the Messenger review.
In the light of evidence from Chester and ongoing variation in performance across trusts, I have asked NHS England to work with my Department to revisit this. It will do so alongside the actions recommended by General Sir Gordon Messenger’s review of leadership, on which the Government have already accepted all seven recommendations from the report dated June last year. This will ensure that the right standards, support and training are in place for the public to have confidence that NHS boards have the skills and experience needed to provide safe, quality care.
Thirdly, by January all trusts will have adopted a strengthened freedom to speak up policy. The national model policy will bring consistency to freedom to speak up across organisations providing NHS services, supporting staff to feel more confident to speak up and raise any concerns. I have asked NHS England to review the guidance that permits board members to be freedom to speak up guardians, to ensure that those roles provide independent challenge to boards.
Fourthly, the Getting it Right First Time programme team will launch a centralised and regularly updated dataset to monitor the safety and quality of national neonatal services.
Finally, we are exploring introducing Martha’s rule to the UK. Martha’s rule would be similar to Queensland’s system, called Ryan’s rule. It is a three-step process that allows patients or their families to request a clinical review of their case from a doctor or nurse if their condition is deteriorating or not improving as expected. Ryan’s rule has saved lives in Queensland, and I have asked my Department and the NHS to look into whether similar measures could improve patient safety here in the UK.
Mr Speaker, I want to take the first opportunity on the return of the House to provide an update on the Essex statutory inquiry. In June, I told the House that the inquiry into NHS mental health in-patient facilities across Essex would move forward on a statutory footing. Today, I can announce that Baroness Lampard, who led the Department of Health’s inquiry into the crimes of Jimmy Savile, has agreed to chair the statutory inquiry. I know that Baroness Kate Lampard will wish to engage with Members of the House and the families impacted, and following their input I will update the House on the terms of reference at the earliest opportunity.
The crimes of Lucy Letby were some of the very worst the United Kingdom has witnessed. I know that nothing can come close to righting the wrongs of the past, but I hope that Lady Justice Thirlwall’s inquiry will go at least some way towards giving the victims’ families the answers they deserve. My Department and I are committed to putting in place robust safeguards to protect patient safety and to making sure that the lessons from this horrendous case are fully learned. I commend this statement to the House.

Lindsay Hoyle: I call the shadow Secretary of State.

Wes Streeting: I strongly echo the sentiments of the Secretary of State and thank him for advance sight of his statement. I welcome the appointment of Lady Justice Thirlwall to lead the inquiry into the crimes committed by Lucy Letby, and I strongly welcome his appointment today of Baroness Lampard to lead the statutory review in Essex. I look forward to receiving further updates from the Secretary of State as soon as possible.
Turning to the case of Lucy Letby, there are simply no words to describe the evil of the crimes that she committed. They are impossible to fathom. Although she has now been convicted and sentenced to a whole-life order, the truth is that no punishment could possibly fit the severity of the crimes she committed. With Cheshire police’s investigation having expanded to cover her entire clinical career, we may not yet know the extent of her crimes. What we do know is that her victims should be starting a new school term today. Our thoughts are with the families who have suffered the worst of traumas, whose pain and suffering we could not possibly imagine, and who will never forget the children cruelly taken from them. We hope that the sentencing helped to bring them some closure, even though the cowardly killer dared not face them in court.
I wish to pay tribute to the heroes of this story: the doctors who fought to sound the alarm in the face of hard-headed, stubborn refusal. This murderer should have been stopped months before she was finally suspended. Were it not for the persistent courage of the staff who finally forced the hospital to call in Cheshire police, more babies would have been put at risk. I am sure the whole House will want to join me in recognising Dr Stephen Brearey and Dr Ravi Jayaram, whose bravery has almost certainly saved lives.
Blowing the whistle on wrongdoing is never easy, which is why it should not be taken lightly. Indeed, we can judge the health of an institution by the way that it treats its whistleblowers. The refusal to listen, to approach the unexplained deaths of infants with an open mind and to properly investigate the matter when the evidence appeared to be so clear is simply unforgivable. The insult of ordering concerned medics to write letters of apology to this serial killer demonstrates the total lack of seriousness with which their allegations were treated.
I welcome the fact that the Secretary of State has changed the terms of the inquiry and put it on a statutory footing. There must be no hiding place for those responsible for such serious shortcomings. It is welcome that the inquiry will have the full force of the law behind it, as it seeks to paint the full picture of what went wrong at the Countess of Chester Hospital, and it is right that the wishes of the families affected have been listened to. I welcome the fact that they will be involved in the drawing up of the terms of reference.
I ask the Secretary of State, people right across Government and people who hope to be in government to make sure that, in future, in awful cases such as this, families and victims are consulted at the outset. Can he assure the House that the families will continue to be involved in decisions as the inquiry undertakes its work?
Mr Speaker, no stone can be left unturned in the search for the lessons that must be learned, but it is already clear that there were deep issues with the culture  and leadership at the Countess of Chester Hospital. This is not the first time that whistleblowers working in the NHS have been ignored, when listening to their warnings could have saved lives. Despite several reviews, there is no one who thinks that the system of accountability, of professional standards and of regulation of NHS managers and leaders is good enough.
Why were senior leaders at the Countess of Chester Hospital still employed in senior positions in the NHS right up to the point that Lucy Letby was found guilty of murder? The absence of serious regulation means that a revolving door of individuals with a record of poor performance or misconduct can continue to work in the health service. Does the Secretary of State agree that that is simply unacceptable in a public service that takes people’s lives into its hands?
The lack of consistent standards is also hampering efforts to improve the quality of management. I am sure the Secretary of State will agree that good management is absolutely vital for staff wellbeing, clinical outcomes, efficient services and, most of all, patient safety. The case for change has been made previously. Sir Robert Francis, who led the inquiry into the deaths at Mid Staffs, argued in 2017 that NHS managers should be subject to professional regulation. In 2019, the Kark review, commissioned by the Secretary of State, called for a regulator to maintain a register of NHS executives, with
“the power to disbar managers for serious misconduct”.
In 2022, the Messenger review commissioned by the right hon. Member for Bromsgrove (Sajid Javid) recommended a single set of core leadership and management standards for managers, with training and development provided to help them meet these standards. We must act to prevent further tragedies, so I welcome the Secretary of State’s announcement that his Department is reconsidering Kark’s recommendation 5. Labour is calling for the disbarring of senior managers found guilty of serious misconduct, so I can guarantee him our support if he brings that proposal forward.
The Secretary of State should go further. Will he now begin the process of bringing in a regulatory system for NHS management, alongside standards and quality training? Surely we owe it to the families and the staff who were let down by a leadership team at the Countess of Chester Hospital that was simply not fit for purpose.
Finally, I know that I speak for the whole House when I say that the parents of Child A, Child C, Child D, Child E, Child G, Child I, Child O and Child P are constantly in our thoughts, as are the many other families who worry whether their children have also been victims of Lucy Letby. We owe it to them to do what we can to prevent anything like this from ever happening again. As the Government seek to do that, they will have our full support.

Steve Barclay: I thank the hon. Gentleman for the content of his response and the manner in which he delivered it. I think it underscores the unity of this House in our condemnation of these crimes, and our focus on putting the families at the centre of getting answers to the questions that arise from this case. I join him in paying tribute to those consultants who spoke up to trigger the police investigation and to prevent further harm to babies. I note the further work that the police  are doing in this case, and also pay tribute to the police team, which I had the privilege of meeting. They have worked incredibly hard in very difficult circumstances in the course of this investigation.
As the hon. Gentleman said, the families are absolutely central to the approach that we are taking. That is why I felt that it was very important to discuss with them the relative merits of different types of inquiry, but their response was very clear in terms of their preference for a statutory inquiry. I have certainly surfaced to Lady Justice Thirlwall some of the comments from the families in terms of the potential to phase it. Of course, those will be issues for the judge to determine.
On the hon. Gentleman’s concerns around the revolving door, clearly a number of measures have already been taken, but I share his desire to ensure that there is accountability for decisions. As Members will know, I have been vocal about that in previous roles, and it is central to many of the families’ questions on wider regulation within the NHS.
The hon. Gentleman mentioned the importance of good management. I am extremely interested in how, through this review and the steps we can take ahead of it, we give further support to managers within the NHS and to non-exec directors. The Government accepted in full the seven recommendations of the Messenger review. The Kark review was largely accepted. There was the issue of recommendation 5, which is why it is right that we look again at that in the light of the further evidence.
It is clear that a significant amount of work has already gone in. A number of figures, including Aidan Fowler and Henrietta Hughes, have focused on safeguarding patient safety, but in the wake of this case we need to look again at where we can go further, which the statutory inquiry will do with the full weight of the law. I am keen, however, that we also consider what further, quicker measures can be taken. Indeed, I have been in regular contact with NHS England to take that work forward.

Eleanor Laing: I call the Chair of the Health and Social Care Committee.

Steve Brine: I place on record my sympathy to the families, who have conducted themselves with the utmost dignity throughout this process and who remain in my thoughts and prayers as well. I welcome the judge-led statutory inquiry that my right hon. Friend has announced. It is the right thing to do, as are the phases of the inquiry, which prevent stuff from taking too long to move fast. As that work moves forward, and the debate rightly continues to touch on how we regulate managers working in the NHS, and remove them, I ask that Ministers remain alert to any “us and them” thinking between managers and clinicians. Surely any successful hospital trust is one team working together, so that defensive medicine is all but impossible.

Steve Barclay: I very much agree with the Chair of the Select Committee on the need for a one-team approach, and on looking at how we encourage more clinicians into management roles. We need to be clear-eyed that often some of those in management positions were already regulated, because they were in medical or nursing regulatory positions, but it is important that we  consider the right approach to ensure accountability for the families. That is why NHS England will look at this further.

Samantha Dixon: Terrible crimes have been committed in the Countess of Chester Hospital in my constituency—my hospital. I thank the Secretary of State for meeting and listening to the families at the heart of this tragic case and for instituting a statutory inquiry into the circumstances surrounding these crimes. Serious questions about NHS accountability and governance have arisen that the inquiry will need to address. Given that the scope of Cheshire police’s Operation Hummingbird has now broadened, what reassurance can the Secretary of State offer my community about our hospital?

Steve Barclay: First of all, I pay tribute to the hon. Lady for the work she has done with the families and the staff in response to these terrible events. It is important that we reassure patients who are using the Countess of Chester Hospital now about the measures that have been put in place; that is why I wanted to bring to the House’s attention House the steps that have already been taken.
However, it was also striking in my discussions with family members that they were at pains to point out that some of the other staff they had been treated by in the Countess of Chester Hospital had been exceptional in their care. There were specific issues that raised very serious concerns, but the families were at pains to point out that there were other staff who had treated them extremely well. Indeed, as the shadow Health Secretary said, there were staff also raising concerns and ensuring that the police investigated. With NHS England colleagues, we are working closely with the Countess of Chester Hospital on next steps, but it is important that the measures we have taken provide reassurance about the quality of care that is available at Chester now.

Andy Carter: I commend the Secretary of State on his decision to upgrade the inquiry and put it on a statutory footing, something I know many of the families wanted. I am keen to understand what steps he can take to give assurances that there is consistency in all hospitals around the UK on the freedom to speak up guardians. What steps is he taking to ensure consistency right across the NHS estate?

Steve Barclay: My hon. Friend raises an extremely important point. That is why in 2022 the guidance around the national freedom to speak up policy was strengthened —I mentioned the appointment in September 2022 of Henrietta Hughes as the Patient Safety Commissioner—and why significant work has been done on the quality of data, looking at the work for example of the getting it right first time teams, so that the data can be analysed more effectively to alert investigation.
Looking at the timeline, there are further lessons around, for example, who had visibility of the Royal College of Paediatrics and Child Health report and when. Clearly there are further lessons that we need to look at, but already the guidance, particularly on freedom to speak up, has been strengthened. Back in 2018 both the Public Interest Disclosure Act 1998 and alongside it the child death overview panel, which reviews all child deaths, were also strengthened.

Justin Madders: As the Secretary of State will be aware, my constituency is served by the Countess of Chester Hospital and many of my constituents work there and are being treated there. There is no doubting the impact this case has had on the whole community, as my hon. Friend the Member for City of Chester (Samantha Dixon) has mentioned. However, as a constituency MP, when I was briefed by the management at the time the issues first emerged, I can say a very different picture was painted from the one we see today. It has been a huge concern that management involved at the time have gone on to work in other parts of the NHS, seemingly with approval from NHS England. I hope the Secretary of State will look into that and that the Kark review recommendations will finally be implemented, because there are serious lessons to be learned from what went on with the senior management.

Steve Barclay: The hon. Gentleman raises an extremely important point. It is right that we focus on that and ensure that the concerns about the revolving door are addressed. On the decision taken by my predecessor, my understanding is that the recommendations accepted from Kark were viewed as effective in addressing that—obviously, the events to which this statement relates have happened since—but I have asked NHS England colleagues in the Department to look again at testing them further in the light of the evidence that has come through from the court case in particular.

Priti Patel: My heartfelt prayers and thoughts are rightly with the families, whose heartbreak and suffering is just unimaginable. I really welcome the tone that the Secretary of State has taken on ensuring that no stone is unturned in the quest for justice. Likewise, I thank him for the support that he has given us in Essex through the Essex mental health trust statutory inquiry that he announced just before recess—we look forward to working with Baroness Lampard on the terms of reference. Can he some provide some assurance so that the 80-plus families who did not engage with the inquiry previously come forward, give evidence and have confidence that their evidence will lead to justice for the loved ones they are missing because of what happened at the mental health trust?

Steve Barclay: I am keen to give my right hon. Friend that assurance. I know that she has personally championed —as have a number of colleagues across the House—the interests of families in Essex to ensure that they get the answers they need. Indeed, she very effectively conveyed to me the concerns about the inquiry in Essex hitherto. Our focus—I think this is an area of consensus across the House—has to be on ensuring that families get the answers that they legitimately deserve. The reason that it was proportionate to shift the Essex inquiry from a non-statutory footing to a statutory footing was the concern of the chair that there was insufficient engagement, particularly from staff but also, as my right hon. Friend just said, from families who did not have confidence in the inquiry as it was. That is why that inquiry has been strengthened and we have put in a very senior chair with experience of the Savile inquiry. I know that my right hon. Friend will be at the forefront in ensuring that the families’ voices are heard moving forward.

Mike Amesbury: I and my Cheshire West and Chester constituents are served by the Countess of Chester Hospital, so I welcome the inquiry’s having been put on a statutory footing, but like other hon. Members across the House, and, in particular, the families of the victims of this horrendous situation, I want to ensure that those managers who have somehow recycled themselves into leadership positions face stronger regulation and accountability. I look forward to the Secretary of State’s expanding on that.

Steve Barclay: It will not surprise the hon. Gentleman that a central concern of the families when I met them was the extent to which they felt fobbed off when concerns were raised and the ability of those managers either to continue in post or to move to new posts. I think that concern is shared across the House. It is very much central to some of the safeguards that have been put in place through the recommendations from Kark that have already been accepted. It also opens up questions about the role of boards and how we strengthen non-executive directors, the training and induction, and the other provisions that we can put in place. Of course, some of those issues are the reason we are having the inquiry, and through the statutory process, there will be the opportunity to call people to give evidence and for the judge-led inquiry to put questions on behalf of the families.

Mary Robinson: I am grateful to my right hon. Friend for the statement and for the announcement of the judge-led inquiry. The shocking murders of those babies and the attempted murders of so many others have shocked the nation. A major concern for me is that managers ignored consultants who had raised serious issues. It appears that there is in some hospitals a culture of people not being listened to when they raise concerns. Dr Stephen Brearey, one of the whistleblowers in this case, says that he has been inundated with emails from people who say that they have not been listened to when they have spoken about really serious issues. I thank the Secretary of State for everything that he has said today, but does he support a strengthening of the whistleblowing legislation so that all whistleblowers know that they will be heard and protected?

Steve Barclay: To provide some reassurance to my hon. Friend, the Public Interest Disclosure Act 1998 was strengthened in 2018. Obviously, that is post the appalling events covered today, but that Act has already been strengthened. The freedom to speak up guardians have also been implemented since these events, and their role has been strengthened further in the guidance. Significant work has also been done on the role of the child death overview panel and the role of data through the Getting It Right First Time team, picking up data where there are concerns. A significant amount of work has been done on that, but of course through the inquiry, we also need to interrogate more clearly why the concerns raised by clinicians were not acted on by those in leadership positions. I am sure that is something that the judge will want to test in significant detail.

Mark Tami: I certainly welcome the Secretary of State’s change of heart on the statutory inquiry: that is vital to get the answers that all the parents deserve. It is also vital that any other parents  who have concerns about the treatment of their child when Letby was working at Chester and Liverpool have those concerns fully investigated or reinvestigated by the police, so will the Secretary of State ensure that the Home Secretary provides whatever resources the police need to make that happen?

Steve Barclay: Given the gravity—the seriousness—of the cases before the House, this issue is something that all Ministers are very seized of, but I will of course relay the right hon. Gentleman’s point to the Home Secretary. From talking to the team, I know that specific funding had been allocated for that in response to the seriousness of these cases, but of course, I will relay that point to my right hon. and learned Friend.

Vicky Ford: It is impossible to imagine the depths of the grief of the families of the babies who were murdered, and it is absolutely right that we try to help them to get the truth, to find out the facts and to make sure that it does not happen again, so I thank the Secretary of State for agreeing to the statutory inquiry and making sure that the parents are involved. In the Essex case, 2,000 people lost their lives and families have waited many years for that truth, so I thank the Secretary of State for progressing with the statutory inquiry and announcing the new lead of that inquiry today. Can he put that same energy into saying that the families will be involved in the terms of reference; that those terms of reference will be agreed swiftly; and that the inquiry will have the resources it needs to get to the truth, too?

Steve Barclay: Again, my right hon. Friend raises an extremely important point. I am extremely keen that the families, as well as the Members of Parliament in Essex, are able to engage with the chair of the inquiry and to shape that inquiry.
As part of the discussion in Chester with families about the relative merits of a statutory or a non-statutory inquiry, one concern was that a statutory inquiry sometimes takes much longer, which is why the point around phasing is important. Of course, the court case itself will have established significant areas of factual information that can be used by the inquiry. I hope my right hon. Friend can see that the decision to put the Essex inquiry on to a statutory footing underscores our commitment to getting families the answers they need.

Tim Farron: My prayers remain with the families who live each day with the consequences of this unspeakable evil. Among the most chilling aspects of this tragic outrage was, as we have heard, the actions of trust leaders and managers, who ignored warnings and belittled whistleblowers. We have to ask ourselves how many lives could have been saved if people had been believed sooner.
I have to say that this feels horrifically similar to the failings in maternity services in my own local trust of Morecambe Bay during the 2000s, when we saw several mothers and babies needlessly lose their lives. Since then, despite the freedom to speak up measures that have been instituted across the country, I still see whistleblowers in other departments in trusts in the north-west marginalised, bullied, unfairly treated and having their careers trashed, all because it would appear there is a  culture of defending the reputation of institutions rather than protecting the safety of patients. What confidence will the Secretary of State give to potential future whistleblowers that, when they speak out in order to save lives, they will not then be singled out?

Steve Barclay: Again, colleagues across the House know that protecting whistleblowers, including whistleblowers in the NHS, is something I have long championed. As I said earlier, the guidance has been strengthened, but one of the best mitigants is having much more transparency on the data, because the more transparent the data is, the more difficult it is for concerns to be ignored. There is a number of issues. We have strengthened the data. We have the freedom to speak up guardians. We need to look at whether, in Chester, if a freedom to speak up guardian were on the board, that would be the right approach. Do we need to look at whether these roles should be on the board? But significant work has already been done since these events and since Morecambe to strengthen the safeguards around speaking up and the Public Interest Disclosure Act. Alongside that, having organisations such as the Getting It Right First Time team looking at the neonatal data is a further important safety process to have in place.

Robert Buckland: It is difficult to imagine a more horrendous set of crimes than the ones committed by Letby, and her cowardly refusal to attend her sentence added grievous insult to the huge injury and misery she has caused to all the families. Can we put on record our thanks to the trial judge and the jury for the incredible work they did? I welcome my right hon. Friend’s commitment to a full statutory inquiry under the Inquiries Act 2005 and commend Lady Justice Thirlwall. Does he agree that it is important open justice is maintained fully so that we and the wider public can fully understand what on earth happened here, because this affects not just those families on the indictment—or the victims on the indictment—but hundreds of families across the entire region, and open justice has to be at the heart of judicial process?

Steve Barclay: First, I join my right hon. and learned Friend in paying tribute to the trial judge and the jury; it must have been a very harrowing case for them to sit on and deal with. He makes, as ever, an important point about open justice. I just have one caveat; I hope he will forgive me. It is that it is also important we get the balance right in respecting the privacy of families where that is their wish, particularly given that quite often these families will have other young children who may or may not know about aspects of this case. So it is important that we have open justice, but at the heart of our approach is ensuring that we are following the wishes of the family, and that includes respecting privacy where that is appropriate.

Rachael Maskell: It is all too tragic, and my prayers are also with the families who have suffered so much over this time. It is 10 years since Sir Robert Francis’s report was published, and of course he put forward the duty of candour, yet the duty of candour of seven consultants was ignored and overridden. As a result of that, will the Secretary of State ensure there is an independent external route through which concern can be raised? Further to that,  will he look at the accountability, scrutiny and supervision of clinicians throughout the health service, because the pressures on the service at the moment mean that those vital double checks are often missed?

Steve Barclay: Again, I agree. It is extremely important that we have the right levels of escalation and the right routes available to those raising concerns. I have already signalled to the House a number of safeguards that have already been put in place following various reviews, including the Francis review. Indeed, I spoke to Sir Robert about the lessons from his report, as I have with a number of other chairs in recent weeks. It is important and a number of safeguards are already in place, but of course the inquiry will look at how those fit together and whether any further steps are required.

Dr Caroline Johnson: I welcome the dashboard the Secretary of State has announced, which will identify outliers so that trusts that have abnormal events can be looked at, but in this particular case the fact that events were happening unexpectedly was identified, staffing analysis was done and seven consultants raised that this was a problem. They identified Lucy Letby as potentially causing this harm and they were repeatedly, repeatedly and repeatedly ignored. We also need to bear it in mind that, if they had not been ignored, some of these babies might not have died, and that is not good enough. As the Secretary of State seeks answers to how this can be prevented, I urge him to focus on three things: how he can develop clear lines of medical, nursing and managerial accountability; how he can prevent poor managers from moving from trust to trust to evade such accountability; and how, if seven consultants find themselves in a similar position in future, they can escalate beyond their trust—outside their trust—to get some attention.

Steve Barclay: A number of steps have already been taken; I am thinking, for example, of the role of medical examiners working in conjunction with the role of the coroner. Those are the sort of areas that the inquiry will look at: the roles of the coroner, the medical director, the Royal College of Paediatrics and Child Health report in 2016, who had sight of that and what action was taken, and the role of the board, including the non-exec lead, in terms of issues around patient safety. So a range of areas will be looked at, which is the whole purpose of having this inquiry. A number of steps have already been put in place, but it is important that we learn the lesson where clinicians have raised concerns and those concerns were not acted on.

Barbara Keeley: I co-signed a letter to the Health Secretary from Salford MPs and the Salford City Mayor detailing that two senior managers from the Countess of Chester Hospital who were accused, as we have been discussing, of repeatedly ignoring warnings about Ms Letby’s actions then left that hospital and were employed or seconded to NHS trusts in Greater Manchester, including Salford Royal NHS Foundation Trust and the Northern Care Alliance. The two managers were re-employed well after the police had launched their investigation into Lucy Letby. This raises serious questions about NHS governance, HR processes, safety, risk assessment and the role of regulators, as already raised by the Labour Front Bench  and my hon. Friend the Member for Weaver Vale (Mike Amesbury). I want to join our concerns from Salford with the concerns the Health Secretary says are already being expressed about the governance issues raised by the re-employment of managers at that time and ask for assurances that this will be fully explored in Justice Thirlwall’s inquiry.

Steve Barclay: The hon. Lady raises extremely important issues and I am happy to give her the assurance that these issues will be explored. NHS England is looking at that. On the concerns expressed around the regulation of managers, the chief exec of NHS England hosted a meeting last week with key stakeholders to discuss these very issues and I will of course relay to the chief exec the points she has raised.

Andrew Selous: A few years ago, I was a whistleblower myself against an orthopaedic surgeon in my local hospital who was putting the same metal implant into patients’ backs whether they needed it or not. No other hospital was doing it; the specialist hospital only ever took it out. From that work, I was a parliamentary advocate with my constituent Tim Briggs for Getting It Right First Time. We pushed that for eight years before the NHS took it up, so I am pleased to hear the Secretary of State talking about it. What I discovered then was that the desire of trust management to cover things up to protect the reputation of their institution seemed to trump doing the right thing and throwing the spotlight of transparency on what was happening. What are the key reforms the Secretary of State spoke about today that will mean that will not happen in future and those brave clinicians who spoke up will be listened to in future cases like this?

Steve Barclay: The key reforms include Getting It Right First Time, the work of Professor Tim Briggs—I raised with him the issue around Chester and the fact that his team have been reviewing that data—the strengthening of the freedom to speak up guardians, the appointment of a new patient safety commissioner, the strengthening of the Public Interest Disclosure Act, the role of child death overview panels and the scrutiny they provide, and the expanded role of medical examiners, which were not in place. So significant actions have been taken, but it is right that through the inquiry we look at the specific issues raised at Chester and any further steps that are appropriate.

Ben Bradshaw: When I saw the list of hospitals that the former chief executive of Chester hospital went on to after the Lucy Letby case, I could tell—I speak as a former Health Minister—that it had an eerily familiar ring about it, because failed managers from previous scandals went on to at least some of the same hospitals. Why is the Secretary of State waiting for another review or for the inquiry before finally closing this revolving door and introducing independent regulation for hospital managers similar to that to which medical staff are subjected?

Steve Barclay: Just to reassure the right hon. Gentleman, it is not that we are waiting. Having discussed it with NHS England, not least in last week’s meeting looking  at the Kark recommendations that were accepted and why recommendation 5 was not accepted, the view at the time was that the accepted recommendations were sufficient in addressing the concern about the revolving door. It is right that we test that, but it is also right that we get the balance right.
The right hon. Gentleman mentions concerns that certain trusts may be seen as more difficult to manage. We do not want to create an environment where people are unwilling to go to those more difficult trusts because they fear the risk that they carry. It is important that we get the right support for managers, particularly around some of the more difficult trusts to manage, alongside having the accountability. Getting that detail right requires us to work closely with NHS England and the wider NHS family. [Interruption.]

Eleanor Laing: Order. There is a lot of noise in the Chamber. People who have come in for the next piece of business are forgetting just how very serious and sombre this piece of business is. Have some thought for others.

Shailesh Vara: The Secretary of State has rightly spoken of the enormous pain and suffering of the parents in this horrific case. He will appreciate, however, that during the course of the Lucy Letby trial, they have had to relive all that pain and suffering. As the statutory inquiry progresses, that pain will be continuing for weeks and months ahead. Will the Secretary of State give an assurance to the House that in the period ahead—during the course of the inquiry and beyond—these parents will receive all the support they need to get through this ordeal?

Steve Barclay: My right hon. Friend is absolutely right about the way that the trial re-triggered a lot of pain and suffering for the families. What I found particularly powerful when talking to them was the fact that they discovered new information during the course of the trial, including harm to their children that they had not been told about hitherto. That was particularly concerning, and clearly serious lessons need to be learned from that. In terms of the support, one of the reasons for wanting to engage with them at the earliest opportunity was to ensure we are doing all we can to support them, and that is central to how I understand the judge will look to structure the inquiry to ensure that the wishes of the families are central to the approach that is taken.

Liz Saville-Roberts: Letby’s crimes freeze the heart, and I commend the Secretary of State for the inquiry being statutory. Although health is devolved, babies from across north Wales are regularly sent to hospitals in north-west England, including the Countess of Chester for specialist care and treatment. What assurance can the Secretary of State give to Welsh families that the statutory inquiry’s terms of reference will include cross-border patient safety and the safety of babies in hospitals possibly hours away from their families in Wales?

Steve Barclay: I am grateful to the right hon. Lady for raising that extremely important point, because the cases of five of the babies concerned in the trial were cross-jurisdictional. It is important that we take on board those lessons and look at how those cases that  apply to a baby or family from Wales are captured, and I know that is something that Judge Thirlwall will give consideration to, shaped by her discussions with the families.

Luke Hall: Having a child in neonatal intensive care is absolutely terrifying. A parent in that situation is completely reliant on the professionalism and compassion of the NHS staff, and that is what makes the crimes of Letby so evil and unfathomable. None of us can imagine what the families are going through right now and what they will have to relive during the course of this statutory inquiry. Can the Secretary of State give an assurance to the House that the anonymity of the families will be protected in the course of this inquiry, if they want it to be, so that they can have the privacy they need during this very difficult time?

Steve Barclay: I absolutely agree with my hon. Friend’s sentiment in putting families and their wishes central. I hope he will understand that as part of an independent inquiry, it will be for the judge to decide which hearings are held in public and which are in private. In essence, part of the initial discussion on a non-statutory inquiry and my discussion with the families was about balancing privacy concerns versus the more adversarial and public nature of a statutory enquiry. I know that Justice Thirlwall will be sensitive to the families’ wishes and what is the appropriate balance between hearings held in public and those held in private.

Diana R. Johnson: After all that has happened, it was surely a mistake not to implement recommendation 5 of the Kark review. Why does the Secretary of State not just get on with it and bring it in to disbar senior managers in the NHS?

Steve Barclay: The Kark recommendations that were accepted, which cover events since those covered at Chester, are believed to have addressed the concerns about the revolving door, but given the issues that have come to light through the case in Chester, I have asked NHSE colleagues to revisit that decision without waiting for the inquiry to look at that. Of course, the inquiry will also look at what is the right balance of regulation for managers.

Anna Firth: I wholeheartedly welcome the Secretary of State’s announcement that there will be a full, judge-led statutory inquiry into these horrifying, despicable crimes. It defies belief that senior NHS managers and leaders could have ignored the concerns of senior clinicians in the NHS for so long. I look forward to reassurance that this statutory inquiry will not hold back in holding those senior managers to account, to ensure that this does not happen in any hospital ever again.
I also welcome today’s update that the Essex NHS mental health inquiry has also moved to a statutory footing and that Baroness Lampard will chair that inquiry. Parents will be reassured to know that she is in the House listening to Members’ concerns.

Steve Barclay: I hope that my hon. Friend will note that the appointment of a Court of Appeal judge underscores the seriousness of the inquiry into the  murders by Letby. The decision before the summer to place the Essex inquiry on a statutory footing again underscores our commitment to giving answers to those families in Essex, particularly where there are concerns that staff have hitherto not engaged with the inquiry in the way they need to do.

Helen Morgan: My thoughts and prayers, and those of my party, are with everyone affected by the unspeakably evil crimes of Lucy Letby. In this instance, we have had a serial killer in play, and that makes it unique, but it is clear that there have been management failings—a failure to listen to senior clinicians, and potentially even a cover-up—and that unfortunately is not a new situation for the NHS. As the MP for North Shropshire, I have seen management failings at the Shrewsbury and Telford Hospital NHS Trust, and my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) has highlighted the failings at Morecambe Bay. We have had numerous inquiries into management failures in the NHS, we have said “never again” so many times, and we are still here. How can the Secretary of State reassure parents and people being treated in the NHS that this time, when we say “never again”, we will mean it?

Steve Barclay: Again, I very much agree on the imperative of learning from the various reviews that have taken place. That is why I have personally spoken to the chairs of those reviews over recent days and weeks. I point out that these events took place before a number of the reviews’ recommendations were made and given to the Government, and those recommendations—whether on the medical examiner role, strengthening under the Public Interest Disclosure Act 1998, the use of “get it right first time” to review the data, the freedom to speak up guardians or the new patient safety commissioner role—have been implemented. So significant actions have been taken following those reviews, and those actions have been taken since these events. However, through the inquiry we will of course test whether further action is needed.

Alison McGovern: As my hon. Friends the Members for City of Chester (Samantha Dixon) and for Ellesmere Port and Neston (Justin Madders) explained, for those of us whose constituents use and work at the Countess, this has been the most dreadful time. But only those who have lost a child could even begin to understand the pain that the families have experienced. It is right that there is unanimity in this House about what is done.
Could I come back to the question asked by my hon. Friend the Member for York Central (Rachael Maskell) about duty of candour? Ten and a half years ago, I stood here in this House and listened to the now Chancellor talk about duty of candour. I am at a loss to understand how it could be that families were not entitled to every bit of information when they asked for it. What review has the Secretary of State already conducted into the effectiveness of duty of candour? What is his conclusion about what has gone wrong over the past 10 years?

Steve Barclay: As I have said, significant action has been taken over those 10 years to strengthen transparency, action taken on data and the ability of freedom to speak up guardians to ensure that more safeguards are  in place. Part of the purpose of the inquiry is to test whether further action is needed. I have already asked NHS England to look again at areas where recommendations have been made and what further action we can take.

Jim Shannon: First of all, I thank the Secretary of State very much for the tone and the compassion of all his answers. He has encompassed all our thoughts and emotions in a very positive way, and I thank him for that. Can he confirm that any procedural changes that come from lessons learned from this dreadful case will be shared throughout the trust areas? It is a horror that has shaken every parent, pregnant mother and midwife in every corner of this United Kingdom of Great Britain and Northern Ireland. They want to know how they can protect the most vulnerable in our society. How can Government ensure that finances do not preclude precautions being taken to protect babies and also staff on the wards? Will the inquiry’s findings be shared with all devolved Administrations?

Steve Barclay: I am happy to commit that the inquiry findings will be shared with the Administrations across Great Britain and Northern Ireland. It is important that the lessons are learned. It is also important that we look at where staff move—that includes not just within England but in Northern Ireland—and at where patients from one jurisdiction may be treated in another for a period of time. Those issues apply across the United Kingdom. We should have a UK-wide approach, including to data and looking at variation across the United Kingdom. I know that the hon. Gentleman will take a keen interest in that.

Reinforced Autoclaved Aerated Concrete in Education Settings

Gillian Keegan: With permission, Madam Deputy Speaker, I would like to make a statement about the steps that my Department is taking to support education settings to respond to the risk of reinforced autoclaved aerated concrete, commonly known as RAAC.
Before I go into specifics, I want to be clear that absolutely nothing is more important than the safety of children and staff. It has always been the case that where we are made aware of a building that poses an immediate risk, we have taken immediate action. Parents and children have been looking forward to starting the new term, and I understand that the timing of this change in guidance to schools and colleges will have caused concern and disruption. However, faced with recent cases, including one that emerged right at the end of the school holidays, I believe 100% that this is the right thing to do. That is why we have taken such rapid steps to support our schools and colleges.
There are over 22,000 schools and colleges in England, and the vast majority are unaffected by RAAC. Local authorities and multi-academy trusts are responsible for those buildings, but we have been supporting schools and colleges to ensure that risks resulting from RAAC are mitigated. To date, 52 schools and colleges have those mitigations in place. The majority of those settings will remain open for face-to-face learning on their existing sites, because only a small part of each site is affected. A minority of pupils will be fully or partially relocated to alternative accommodation to continue face-to-face learning while mitigations are put in place.
I want to reassure parents and children that we are taking a deliberately cautious approach to prioritising children’s safety. Because of our proactive questionnaire and surveying programme, we have a better understanding of where RAAC is on the school estate than in most other countries. All schools and colleges that have advised us they suspect they might have RAAC will be surveyed within a matter of weeks—in many cases in a few days. Most suspected cases will not have RAAC. So far when we have surveyed schools, around two thirds of suspected cases do not have RAAC. We will follow the same approach with any new cases through the professional surveying programme.
The vast majority of schools will be unaffected and children should attend school as normal unless parents are contacted by their school. As my right hon. Friend the Minister for Schools explained on Friday, we will publish a list of schools once mitigations are in place. It is right that parents are informed by schools if they are impacted, and that schools have time to work with their Department for Education caseworker on those mitigations.
I am confirming today that we will publish the list of the 156 schools with confirmed cases of RAAC this week, with details of initial mitigations in place. After that, we will provide updated information as new cases of RAAC are confirmed and existing cases resolved. This will include updates on the impact on pupils, such as how many are learning face-to-face and how many are receiving short periods of remote education. Once again, we are doing everything in our power to minimise disruption and avoid remote learning.
I must thank the professional response of leaders, teachers and support staff in the sector, who have acted swiftly to deliver contingency plans. Each impacted school and college has a dedicated caseworker to help implement a mitigation plan. This could include other spaces on the school site or in nearby schools, or elsewhere in the local area, until structural supports or temporary buildings are installed. We have increased the supply of temporary buildings, working with three contractors, and accelerated the installation of these. We have the support of our leading utility companies to ensure that those classrooms can be opened. In the small number of schools with confirmed RAAC, disruption to face-to-face learning has usually lasted a matter of days.
With regard to funding, as the Chancellor said, we will spend whatever it takes to keep children safe. That includes paying for the emergency mitigation work needed to make buildings safe, including alternative classroom space where necessary. Where schools need additional help with revenue costs, such as transport to other locations, we are actively engaging with every school affected in order to put appropriate support in place. We will also fund the longer-term refurbishment or rebuilding projects, where these are needed, to rectify RAAC.
Professional advice from technical experts on RAAC has evolved over time. Indeed, the question of how to manage its risks across all sectors has spanned successive Governments since 1994. My Department alerted the sector about the potential risks of RAAC in 2018, following a sudden roof collapse at a primary school. We published a warning note with the Local Government Association, which asked all responsible bodies to
“Identify any properties constructed using RAAC”
and to
“ensure that RAAC properties are regularly inspected by a structural engineer”.
In February 2021 we issued a guide on how to identify RAAC. Concerned that not all responsible bodies were acting quickly enough, in 2022 we decided to take a more direct approach. We issued a questionnaire to responsible bodies for all 22,000 schools to ask them to identify whether or not they had, or suspected to might have, RAAC. Responsible bodies have submitted responses to the questionnaire for 95% of schools with blocks built in the target period.
In September 2022 we started a programme where the DFE sent a professional surveyor to assess whether RAAC is present. If RAAC was present, the previous DFE guidance was to grade it as critical or non-critical, and only take buildings out of use for critical RAAC cases. Such was the level of our concern, however, that I asked officials to seek evidence of risks, including to non-critical RAAC. It is because of this proactive approach that we discovered details of three new cases over the summer, where RAAC that would have been graded as non-critical had failed without warning. The first was in a commercial setting. The second was in a school in a different educational jurisdiction. In that instance, the plank that failed remained suspended, resting on a steel beam. As the plank was fully intact, DFE engineers were able to investigate the situation. In their professional judgment, the panel affected would have been previously rated as non-critical, but it had failed.
Ministerial colleagues and I were already extremely concerned, but then a third failure of RAAC panels occurred, at a school in England in late August. This was a panel that had previously been graded as non-critical. Because children’s safety is our absolute priority, it was right to make the difficult decision to change our guidance for education settings, so that areas previously deemed to contain non-critical RAAC are now being closed.
I want to set out why we are taking this more cautious approach with the education estate in England. Professional guidance is clear that wherever RAAC is found, it needs to be monitored closely. The school estate is very disparate, consisting of 22,000 settings with more than 64,000 individual blocks. Monitoring RAAC closely is therefore very difficult on the estate, and many responsible bodies do not have dedicated estates professionals on all school or college sites at all times. That is why the approach we are taking is the right one for our schools and colleges. My officials have worked closely with experts in this field. Chris Goodier, professor of construction engineering and materials at Loughborough University, has said:
“DfE has been employing some of the best engineers on this and have consulted us and the Institution of Structural Engineers”.
The Government’s priority is for every child in the UK to go to school safely. My officials have been engaging urgently with the devolved Administrations to discuss our findings and offer support in order to understand the situation in relation to RAAC on school estates in Scotland, Wales and Northern Ireland. Last week I wrote to offer my support, including further official or ministerial-level engagement, and to facilitate discussions between our technical experts.
I am aware that this policy change occurred during the recess, and that I was therefore unable to notify the House in advance. For that I apologise, Madam Deputy Speaker, and I hope you understand why I felt that I had to take the decision when I did. We are taking an extremely cautious approach to the issue, but I believe that this is the right thing to do when it comes to the safety of children. I commend this statement to the House.

Bridget Phillipson: I thank the Secretary of State for advance sight of her statement.
I will turn in a moment to the sorry story of how we got here, but let me first ask the House to reflect on two things. First, the safety of children and staff in schools today should be our highest priority, and while the voices of children are rarely heard in this place, it is their welfare, their hopes and their fears that should be uppermost in our minds today. Secondly, the mark and measure of each of us as politicians is our willingness to take and to accept responsibility: collective responsibility, not just for our own actions but for those of the Governments in which we serve—and this week, as the school year begins, there is an awful lot of responsibility for Ministers to take.
What an utter shambles this is. The defining image of 13 years of Conservative Government is one of children cowering under steel props, there to stop the ceiling falling in on their heads. Thirteen years into a Conservative Government, the public realm is literally crumbling around the next generation. The Education Secretary  said this morning that in her view it was not the job of her Department to ensure the safety of our children’s schools, and that she was doing a good job. Schools are literally at risk of collapse. She is the Education Secretary, so whose responsibility does she think it is?
This is the tragic endgame of the sticking-plaster politics of the last 13 years. Children have been failed by this Conservative Government. It is RAAC that is our focus today, but the issue is wider and deeper across our schools and across our country. It is deeper because school buildings are only part of the wider failure in our education system, over which Ministers have been presiding for 13 long years. It is wider because thousands upon thousands of schools and other public buildings were built in the last century, and were not intended to last for more than a couple of decades. This was system build—quick, cheap, too often involving asbestos, and not expected still to be there in 30 years’ time. That is why the previous Labour Government took responsibility and began rebuilding them, the length and breadth of our country. That is why we launched the Building Schools for the Future programme, to give our children the start they deserved. That is because then—as now and as always—Labour puts children first.
The Schools Minister today is the same Schools Minister who scrapped Labour’s plans as one of his very first acts back in 2010. In 2010 the Conservatives scaled back plans to just 150 school rebuilding projects each year, slowing the pace of renewal. In 2021, when their then Chancellor—now the Prime Minister—delivered a spending review, he cut the pace again to just 50 a year, and today the previous permanent secretary at the Department for Education told of the Department’s bid to double the schools rebuilding programme in 2021 being knocked back by the then Chancellor, who instead of doubling it, almost halved it.
I spoke earlier of responsibility. The Secretary of State was clear just a few hours ago that she refuses to accept any responsibility, so who on the Government Benches today will take responsibility for decision after decision to slash spending on school safety? I thank the Secretary of State for having addressed some of the questions that families across this country will have, but I am afraid that there are many, many more. Time is short, so I will ask many of them in writing, but I hope that she will be able to answer these questions now, and to answer all my questions in full.
Why is the Secretary of State still refusing to publish the list of affected schools, promptly and in full, today? Why did the condition data collection survey between 2017 and 2019 not look in more detail at these issues? What strategy does the Department have right now for the wider condition of system build schools and other educational premises that are long past their design lifespan? How many other educational settings are currently believed, or suspected, by the Department to contain RAAC where that is yet to be confirmed? Do emergency services have the information they need, should something go wrong? What is the estimated timeline for completing the necessary repairs in affected schools? How long will students face disruption during this process? Which capital budgets are being raided and which priorities are being downgraded today to fund the works that are happening now? What assessment has been made of the  risks of a RAAC failure in the context where asbestos is also present? There are many more questions I could ask, but the most important is this: who in this Government in the months ahead will take some responsibility for sorting out the chaos that our children face?

Gillian Keegan: I thank the hon. Lady, and of course that is me, but what matters is what you do. When I was given new information and had to consider the impact that this would have on our schools and children, I took action even though it was politically difficult. Yesterday, when the hon. Lady was asked about Wales and RAAC, she waved away concerns and said that there was no problem. Why? Because it involved a Labour Government with Labour policies. Today, two schools closed in Wales just as they start their surveying programme. We started our surveying programme in March 2022. One of these involves taking decisions and being honest with the public; one is trying to score political points. I answered her question: the information will be provided this week—[Interruption.]

Eleanor Laing: Order. That is enough.

Gillian Keegan: Thank you, Madam Deputy Speaker. I think I answered the hon. Lady’s question. The information will be published this week. Everything will be fully funded: the mitigation, any revenue that is required on a case-by-case basis, and also the rebuilding of the schools.
When it comes to doing a good job, I make no apologies for praising the work of the Department for Education. Not my work, no, but the work of colleagues, of schools and of professionals who have helped to ensure that we are not sending children back to school without the guarantee that they will be safe. I have had teams working for weeks and all weekend to get portacabins, to find alternative sites and to help put in place urgent mitigations. Those people are doing a brilliant job and I want to thank each and every one of them.

Maria Miller: My right hon. Friend is absolutely right to put the safety of children first and to take a cautious approach, but I know from speaking to headteachers in my constituency that her Department has been speaking to schools about RAAC and how to mitigate it not just for weeks or months, but for years. One of my schools, in Cranbourne in Basingstoke, already has in place a plan with her Department for how to resolve that problem, but the new technical guidance has thrown up two suspected cases of RAAC in my constituency. Could she outline for parents how quickly those suspicions will be either confirmed or negated, so that those schools can continue to function fully in the future?

Gillian Keegan: I thank my right hon. Friend, her local authority and her responsible bodies for responding to the questionnaire. Ninety-five per cent. have done so, which is why I am really worried about the 5% that have not. We will survey those with suspected cases in the next few weeks—we will probably get to them in the next two weeks. About two thirds of those surveyed turn out not to have RAAC, but we want to know exactly where it is. We want to make sure we completely mitigate all those cases.

Carol Monaghan: I thank the Secretary of State for advance sight of her statement.
Obviously, the safety of children is paramount and urgent actions have to be taken to resolve this situation. The Chancellor said yesterday that the Government will “spend what it takes” to sort out this problem, yet Treasury sources have admitted that there will be no new money to pay for the remedial work, with the cash instead coming out of the Department for Education’s existing capital budget. Can the Secretary of State give us some clarity on that? Given that existing budgets are already extremely stretched, what discussions is she having with Treasury colleagues to access additional funding?
The Secretary of State mentioned the devolved Administrations, and clearly this affects buildings across the UK. The Scottish Government’s budget has already been cut, so can she confirm that there will be additional funding for the devolved Administrations to carry out the remedial work that will have to take place in those jurisdictions?
The Sunday Mirror has reported that up to 7,000 schools could be at risk but have yet to be assessed, and a National Audit Office report in June found that 38% of English school buildings had passed their recommended RAAC lifespan. This means that around 700,000 children in England are being taught in schools that require major rebuilding.
The Secretary of State mentioned the questionnaire that has been sent out to 22,000 schools. Can she give some clarity about the responders? What expertise do they have to make the assessments to which she refers? Given the figures I have just quoted, it would be good to know the number of schools affected, as a number in the hundreds seems unrealistic. Can we have a more realistic figure for the number of schools that are likely to need work to be done?
Finally, can the Secretary of State guarantee that children in schools that have not been closed are absolutely safe to return to lessons?

Gillian Keegan: I do not know whether we can believe everything we read in the press, but I have read that Scotland does not plan to close schools with RAAC, which is a bit worrying. We will continue to share technical information with our counterparts, and we have offered meetings.
When we receive new information and new evidence, we sometimes need to take a new approach. That is the decision I took very recently, and I think it is the right decision. I would be very happy to work with the hon. Lady and her colleagues to share more information.
Every year we have a capital budget, and we are investing significantly in our schools. The overall capital budget in the 2021 spending review was £19 billion, of which £7 billion is allocated for 2023-24. When we come to the next phase, we have allocation to rebuild some of our schools, but we will look in detail at what more will be required.

Priti Patel: The Secretary of State will know that St Andrew’s Junior School in Hatfield Peverel is now closed, and other schools in my constituency, including two large secondary schools, are experiencing  partial closures. They have mitigations in place, and there is a lot of work under way. I hope she will join me in thanking Essex County Council, in particular, for the extraordinary leadership it has shown in working with schools. I also put on record my thanks to the noble Baroness Barran, who has been supporting Essex MPs and families.
I have some specific questions. Promises have been made on capital costs, but will there be support for revenue impacts such as travel, switching to remote learning and, in particular, children with special educational needs? Our county has a very high level of pupils with special educational needs and disabilities, and we need to understand that.
If I may, Madam Deputy Speaker, let me ask about caseworkers, who have been mentioned. We need to know whether or not they are going to engage with MPs; my experience to date has been that they are not prepared to speak to MPs about what is going on in schools. Finally, what is Ofsted’s role in this? If it is going to be looking at schools, will it account for disruption caused by this issue and for the impact it will have on school exams, particularly for children who are being examined this year?

Gillian Keegan: I thank my right hon. Friend for that, and I very much join her in praising Essex County Council. There are a lot of cases in Essex—there is a concentration there—and it has done an amazing job. It has answered all the questionnaires in great detail and it is very much gripping the issue, and we are working very closely together.
On revenue, we have said that on a case-by-case basis, if the school will come to the Department and tell us what revenue impact there is, we will make sure that it has the support it needs. Caseworkers are currently focused on working with the schools; it is very early in this process. We are mitigating a lot of the work, but not everybody is as far ahead as some of the schools to which my right hon. Friend referred. We have opened a hotline—a helpline—for Members of Parliament. We extended the hours so that it was open at the weekend. I know that some people got their “Dear colleague” communication and did not notice it until the helpline had closed, so we had that open at the weekend—it will be open all through the week as well. They will be getting the same information from the caseworker system, and that is how it will work.

Ben Bradshaw: When the Prime Minister, as Chancellor, slashed the schools repair budget, despite being warned of the danger to children, how big a factor in that decision was the fact that neither he nor most of the Conservative Cabinet actually use state schools for their own children?

Gillian Keegan: It is simply not correct to say that the size of the school rebuilding programme has been cut in recent years; it is currently at the same scale as was announced in 2020, which is roughly in line with the scale of rebuilding projects being delivered per year since the start of the previous programme. [Interruption.] So, if Members want to listen, it is the same scale of rebuilding projects being delivered per year as since the start of the previous programme. The priority school building programme will continue and we will continue to fund the schools.

Several hon. Members: rose—

Eleanor Laing: I call Sir Julian Lewis.

Julian Lewis: Thank you for calling a state-educated Conservative Member, Madam Deputy Speaker.
May I, through the Secretary of State, thank Baroness Barran, who reached out immediately to me, together with a highly competent senior official, when this problem arose in one of my local schools this March? Not only did they do that, but they seized the opportunity to encourage a resending of the questionnaire to the network of schools, through the contact that I had with one of my local headteachers. I have rarely, in 26 years in this House, seen a Department so proactive on an issue as this Department has been on this one, and I thank it for that.

Gillian Keegan: I thank my right hon. Friend, from one state-educated person to another. It is true that we have taken action quickly, but Baroness Barran, in particular, has been working on this since way before I was in the Department and has done an amazing job. I thank him for recognising that. She has really pushed us to make sure that we get additional information, get the evidence and have all the surveys back, so that we know, unlike most other places, where RAAC is in our schools. When I was tasked with the new evidence, I could identify exactly which schools were impacted immediately because of all the work that she had done.

Diana R. Johnson: As we have heard already that the capital budgets for this year are going to be raided to pay for the Government’s failure and incompetence over the past 13 years on maintaining and rebuilding our schools, can the Minister just explain to me what will happen to schools, such as Hall Road Academy, in my constituency, that are desperately in need of a rebuild? Will that school get the rebuild now? Finally, if she is really short of cash in her Department, perhaps one option might be to bring in a swear box to raise a few bob. [Laughter.]

Gillian Keegan: I thank the right hon. Lady for her joke, but as a Scouser I have a bit of a higher bar, I think.
In addition to our targeted work on RAAC, we have continued to invest in improving the condition of the school estate, with over £15 billion allocated since 2015, including £1.8 billion committed for 2023-24. That is informed by the consistent data on the condition of the estate. By the way, the Labour programme, about which there were scathing reports, did not even look at the condition—it was not a factor or a criterion. On top of that, we will transform 500 schools through our school rebuilding programme, prioritising those buildings in the poorest condition and those where there is evidence of safety issues.

John Redwood: Will individual schools have direct access to the money and the temporary accommodation, if they need it? And will every local education authority make an urgent statement about their role in commissioning the schools in the first place and about maintenance, where they are responsible?

Gillian Keegan: We have put a caseworker in place so that each school can work with that caseworker, as well as having access to the temporary accommodation and the company that can do the propping work, which we have already secured, or to additional surveying, if required. We are working closely with local authorities, but I urge the 5% of local authorities that have not responded to the questionnaire to respond—that is more important than ever.[Official Report, 18 September 2023, Vol. 737, c. 10MC.]

Christine Jardine: I thank the Secretary of State for her statement, but I urge her to do two things. First, will she impress on the Prime Minister that this is a national-scale problem that will reach across all Departments, as we know there are other affected public buildings? She mentioned putting children’s safety first, and I am sure we all agree with her, but in her discussions with the devolved authorities, will she impress upon the Scottish Government the need for urgency? As she mentioned, they are still saying, as of today, that the buildings are safe. Two primary schools have been named in my constituency and I am concerned that perhaps the Scottish Government are not acting with the urgency that is necessary.

Gillian Keegan: There are two ways of going about this. The first is to go through the responsible bodies. To be fair, that was what we were doing until 2019, but then we did not think that we were being quick enough. We did not have a good enough picture of where RAAC was and what state it was in. That was why we started the direct questionnaire and surveying programme that has enabled us to have the data to take quick action when we got new evidence over the summer. We will continue to share that new evidence with the devolved Administrations. I believe that sometimes it is right to take a direct approach. That is not typical for a Government Department in Whitehall, but sometimes it is the correct thing to do. That is what we have done, and I think that will put us in good stead for being decisive about keeping pupils safe.

Vicky Ford: The three schools known to have RAAC in my constituency have all opened safely to all students this week. I particularly thank the headteacher and team at Springfield primary school. They had to close their year 5 and 6 classrooms last term, but immediately, within a week, the students were found accommodation in other schools. All the building work has been completed over the summer and the prefabs that had been ordered just in case are now being released to other schools.
It is right that children’s safety comes first, but it is also right that we are mindful of the language that we use towards children and do not make them more frightened than they need to be. I would encourage colleagues not to exaggerate or generalise the risks, but to work with each affected school calmly to get the issue resolved for children.

Gillian Keegan: My right hon. Friend is absolutely right. We are working proactively. We have the information, the skills and the people who are going to support us. What is most important is that we minimise the disruption to children. As my right hon. Friend points out about her own constituency, in most cases there is minimal impact, but we have to work together to ensure children are back in school as soon as possible.

Stephanie Peacock: I was a teacher at a secondary school when the Building Schools for the Future funding was cut by the Conservative-led Government in 2010. Has the Department for Education carried out an assessment comparing schools that had their BSF funding cut with those that have RAAC?

Gillian Keegan: Yes, I have, and there are not very many. There are two things that we need to know about Building Schools for the Future. The first is that it was not based on condition, and the second is that it did not include a single primary school. Many of the schools that we have identified—156 of them—are primary schools. I was not involved in the Building Schools for the Future programme, but I have looked at it in great detail. I remember it from growing up in Knowsley. The schools that were built did not contain a single classroom wall. Known locally as the “wacky warehouses”, they cost a fortune and then cost millions to put right afterwards. I point the hon. Lady to the James review, which was pretty scathing about the programme, saying that it was bureaucratic, that it failed to deliver—I think it delivered 180 schools—that it was not based on condition and that it built wacky warehouses in Knowsley.

Bernard Jenkin: As the MP with eight identified schools with RAAC issues and two others under investigation, which is more, I think, than in any other constituency, may I thank her for her exemplary statement? It was perfectly rational and demonstrated that she personally has taken on her responsibilities despite the political dangers that she has put herself into. May I just ask about the caseworkers? Is there one caseworker for each school? If not, how many schools is each caseworker having to deal with? It would also be helpful if we could contact the caseworkers, as my right hon. Friend the Member for Witham (Priti Patel) said.
Finally, may I ask about the school buildings that have already closed? Mistley Norman in my constituency, for example, was closed in July, and the Secretary of State will know that I had a meeting with Baroness Barran about that in July, which means that we have been working on this long before the issue blew up last week. Will the capital funding be made available to rebuild Mistley Norman School?

Gillian Keegan: My hon. Friend is right that he has many impacted schools in his area. On capital funding, the Chancellor was very clear that we will do whatever is necessary to keep children safe. There are three stages. The first is the funding to make sure that we put all the mitigations in place. The second is to look at revenue funding if that is required on an ongoing basis, and the third is the rebuilding programme. On the caseworkers, there are just over 50 of them, so they are more or less dealing with two schools each. On the matter of access to the caseworkers, as I have said, right now they are focusing on the schools, but the helpline is supposed to have access to the same information. Perhaps we will consider a specific approach for Essex MPs, so that we can go through the work in detail with some of the caseworkers, because I think that could be helpful.

Rushanara Ali: After Grenfell, many of us raised concerns about the risks to buildings from other materials, but they fell on deaf ears.  This morning, the Prime Minister said that some 900 schools could be affected. Warnings were made to the Government many years ago, but they fell on deaf ears. Can the Secretary of State explain to the British people—parents who are rightly concerned about whether their kids and their kids’ schools could be affected—that their children will be safe and that she will put in place the support and resources that are urgently needed to respond to this crisis, which has been brought about by the negligence and incompetence of her Government?

Gillian Keegan: The hon. Lady needs to know that the Labour party was also warned about this issue in 1999, 2002 and 2007, and what did it do? Nothing—not a single survey. Yesterday, the shadow Secretary of State dismissed concerns about RAAC in Wales, because the Government there were following Labour policies. As soon as a school collapsed in 2018, we issued a warning to all responsible bodies that they were the ones that were responsible. We also issued guidance on how to identify RAAC, and, in answer to the hon. Lady’s question, instructed them to use structural engineers to do that. We also thought that we needed to go further, which is why we are probably the only country in the world that has a good understanding of where RAAC is in all our schools.

Stephen Metcalfe: Obviously, this is a very serious issue, but when I talked to the chief executive of a large, multi-academy trust at the end of last week and over the weekend, he said that the Government had absolutely made the right decision in the guidance that they had given. As we have heard, we are particularly affected in Essex—about half the schools are in Essex. Indeed, Madam Deputy Speaker, I believe that you are very concerned about six schools in your own constituency. While we are working through those, one issue that has been raised with me is that of ongoing funding. I know that the Secretary of State has already addressed this, but can she again confirm from the Dispatch Box that any additional revenue costs—reasonable revenue costs—will be met so that budgetary concerns will not be a barrier to delivering face-to-face education that our children so richly deserve?

Gillian Keegan: I am glad that my hon. Friend used the word “reasonable”, because the reason we have asked for the revenue to come on an individual basis is that they will all differ. Obviously, we need to ensure that it is reasonable, and that it is put in place. We will certainly support any school with additional funding as is required. Due to the fact that, as he mentioned, almost half the cases are in Essex, it probably warrants setting up a working group with the Essex MPs, so that we can work through them in great detail.

Eleanor Laing: Excellent. I call Jess Phillips.

Jess Phillips: I believe Birmingham is quite badly affected, if the Secretary of State would like to come and hang out with us. I have a number of schools in my constituency that have RAAC confirmed, and some where it is suspected. One particular concern of the headteachers is that they are this week expecting Ofsted to come in, having had to completely redo all their timetables and change all their teaching  arrangements over the weekend. I wonder whether the Secretary of State can give some assurances that that will not be allowed to happen where that is the case for any of these schools.
On timing, the Secretary of State said earlier that she had teams working for weeks on procuring portacabins, which suggests that she knew before 31 August that more schools would need to close all or part of their building. Can she explain why she had people procuring portacabins for weeks?

Gillian Keegan: Very happily. The hon. Lady might work out that I do know this in great detail. The portacabins that we were procuring for weeks were for the 56 buildings that we had already identified with RAAC that were critical. We took those immediately out of use, so we had that need for those 52—it was actually 52. The 104 that were non-critical are now deemed critical because of this new evidence, so we will continue to do that. We have contacted more suppliers already and we have that in place, because we do not want to have a delay there.
I am always happy to visit the hon. Lady in Birmingham. In terms of the particular Ofsted case, if she wants to give me the details we will see, if it is appropriate, whether we can delay it. Ofsted usually delays if there are some specific issues within a school, so we can raise that with it.

Anna Firth: Putting the safety of children first is obviously right, but the Secretary of State will know that Kingsdown School, a special school in my constituency of Southend, houses some of the most vulnerable children in Southend and indeed the south-east, and is currently closed due to RAAC. The headmistress, Louise Robinson, and the new cabinet portfolio holder Helen Boyd at Southend City Council have been brilliant, working around the clock—I thank the Schools Minister too for his support last week—but they need three things. They need the result of a risk assessment, some demountable classrooms and some structural remediation measures. Will the Secretary of State please write and tell us exactly when those will materialise?

Gillian Keegan: I am very happy to. I know that Kingsdown was one of the first identified, and obviously has additional special needs as well. A caseworker is looking into that. Also, just so that it is clear why we made the decision not to publish all the names initially, Kingsdown’s name was published by the council and it was inundated by media, which made it incredibly difficult. The school asked for our help in ensuring that it did not have too much of a media distraction, so we really needed to be conscious of that as well.

Meg Hillier: The Department for Education itself assessed in 2020 that it needed around £7 billion a year for capital funding for schools. The Department bid, after some negotiation, for £4 billion in the 2020 spending review but was allocated only £3.1 billion. That was after over a decade of underinvestment in capital and maintenance in school buildings. Can the Secretary of State not acknowledge that some of these things are chickens coming home to roost?

Gillian Keegan: As I said in answer to an earlier question, we are investing significantly in our schools. The overall capital budget of the 2021 spending review was £19 billion, of which £7 billion was allocated to the year 2023-24.

Mark Francois: I commend the work of Baroness Barran and county councillor Tony Ball and all his team at Essex County Council, who have worked their socks off ultimately to keep children safe, but I regret to tell the Secretary of State that, having now managed to speak to all the heads of affected schools in my constituency, there are a number of differences between what I have been told by her Department and the ground truth that I have been told by the headteachers. For instance, back in July Hockley Primary was promised eight relocatable classrooms ready to go by today; they now will not be available until mid-November. When the list is published later this week, can the Secretary of State please ensure that the information in it is absolutely accurate and up to date, because that is the best way to reassure parents, staff and pupils, not least those parents who will be very upset if they hear with virtually no notice that they have to take weeks off work because their children cannot go to school?

Gillian Keegan: My right hon. Friend raises one of the challenges that we face. In the case of Hockley, soft ground has meant that we have to put footings in place before we can put in the temporary accommodation. Each site is different to some degree. That was one reason we were taking time to ensure mitigations could be put in by school. It is difficult because each school could have specific circumstances. I am afraid that the list and the information will evolve over time as we get more and more details, and the caseworkers will keep us up to date on that.

Andrew Gwynne: Today the Secretary of State has proved the value of having media studies on the curriculum.
On the serious point, I have been notified by both my local education authorities, Tameside and Stockport, that no schools under their control are affected. What they cannot tell me is whether any of the voluntary-aided, academies or free schools within their areas are affected. I would like to know how soon we will get those assurances. On Russell Scott Primary School in the Denton part of my constituency, which we have battled to get successfully added to the Government’s school rebuilding programme—it has its own issues, not associated with RAAC—can the Secretary of State assure me and the headteacher that it will not be bumped down the programme to patch up this mess?

Gillian Keegan: If the hon. Gentleman has schools impacted in his area—multi-academy trusts—they will have heard directly from us and he should have a “Dear colleague” letter with the details. Then he can contact the helpline to get more information, if he wants to. I thank him for his kind comments about media studies; I think it proves that that is not what I did before I became a politician. In terms of Building Schools for the Future, it will be based on condition and need, but of course we will work with him and his school and tell him its condition and need and whether it is prioritised.

Geoffrey Clifton-Brown: The Secretary of State is absolutely right to prioritise the safety of our children and to close schools where necessary. Will she now give the House an assurance that those 600 priority schools will be surveyed as quickly as possible? Then we can move on to all schools and find out where RAAC is present, and take the appropriate remediation for every school that has it.

Gillian Keegan: I assure my hon. Friend that it is already below that number because we have been surveying every day. We have now contracted eight building surveying companies—we had three; we now have eight—to ensure that we have sufficient capacity to do that as quickly as possible. We will do a survey for all the ones that are suspected to have RAAC—as I said, most of them will probably not go on to be confirmed to have it—and we hope to get through them all in the next couple of weeks.

Tim Loughton: As one of the Ministers who came into the DFE back in 2010, we found that, contrary to some of the claims made by those on the Opposition Front Bench, Building Schools for the Future was hugely expensive, hugely bureaucratic, involving elaborate quangos, with most of the money being spent before a single brick had been laid, and mostly built with private finance initiative funding, saddling schools with interest payments for 30 years. How many of these schools may have been PFI-funded, and who will pick up the remedial work bill for them?

Gillian Keegan: My hon. Friend reminds us all of the other legacy of the Building Schools for the Future programme: the PFIs that probably they are still paying for today. The Department has taken a different approach and has reduced costs by simplifying the design and construction, with more standardisation of design, and finding economies of scale by offering central procurement, and we have reduced the cost significantly of each school. On PFI, I will have get back to him, because I do not know how many of these, if any, have any remaining PFI—certainly not under our watch.

Lyn Brown: In Newham, we have 8,363 children in temporary accommodation thanks to the Government’s housing policies. That is more homeless children in one borough than in three whole English regions combined. At the moment, we have one primary school confirmed with RAAC and several others, including a very large secondary school, still in limbo. School closures may therefore be a problem for thousands of children who, as during covid, will not have access to remote learning. Can I at least be assured today that, this time, this Government will prioritise children without access and provide particular and individual resources to support their education, so that they do not endure yet another blight on their life chances due to the continuing incompetence of this Government?

Gillian Keegan: I assure the hon. Lady that this is nothing like covid; it is going to be much quicker. We will reduce the impact on face-to-face learning as much as possible and of course we will prioritise getting children back and making sure that they are in school. On Newham, I am sure she is absolutely delighted that, due to the reforms of the Conservative Government, it is now one of the best-performing areas in the country.

Jack Brereton: I am not aware of any RAAC schools in Stoke-on-Trent, but we have a number of schools with wider serious structural and safety issues, particularly Trentham Academy in my constituency, which we hoped would be included in the school rebuilding programme, but that was stopped because of the PFI agreements. Will my right hon. Friend ensure that, just as with all the RAAC schools, we assess schools for wider structural and safety issues and look at how we can ensure that the schools that are part of PFI agreements can have those issues addressed as well?

Gillian Keegan: I know my hon. Friend has raised that particular school before and has had a couple of meetings on it. The school rebuilding programme is focused on condition and we will specifically work with him to understand what options there are for that school and what PFI is doing to stop its eligibility for rebuilding.

Eleanor Laing: I call Sarah Dyke for her maiden question.

Sarah Dyke: Children in Somerset have gone back to school and are going back to school this week in buildings that may collapse at any moment. At least three schools in Somerton and Frome may have this weak concrete. Will the Education Secretary apologise for all the stress that this Government have caused families because they have slashed repair bills and sat on their hands for months?

Gillian Keegan: I thank the hon. Lady for her maiden question. It is a little ill-informed. If the schools in Somerton and Frome are identified, she will have a “Dear colleague” letter; I will just check that has happened, because I know she is new to the House. If the schools are suspected, as long as her local authorities or multi-academy trusts have responded, we will be coming to do the surveys as soon as possible and then we will have mitigation actions in place to make sure that there is minimum disruption to children in Somerton and Frome.

Maggie Throup: To reassure Erewash residents, will my right hon. Friend reconfirm her commitment to the school rebuilding programme, specifically the two recently approved projects at Kirk Hallam Community Academy and Saint John Houghton Catholic Voluntary Academy in my constituency, and can she reassure me that the timetable for those rebuilds will be unaffected by the need to carry out repairs to school buildings found to contain RAAC?

Gillian Keegan: I think I had probably better get the names of the schools and check the details, but I believe that they will still be going ahead if they have already been approved. If my hon. Friend can give me the details, I will make sure I get an answer to her quickly.

Clive Betts: The Chair of the Public Accounts Committee rightly drew attention to the National Audit Office report that highlighted the serious underfunding of the capital programme in the Department for Education, which is the real cause of these problems. That report also said:
“DfE currently lacks comprehensive information on the extent and severity of potential safety issues across the school estate”.
That is a damning indictment. The Secretary of State cannot stand up in this House today and say that our children are safe, because she does not know whether any more systemic failures of schools presenting safety problems are going to occur.

Gillian Keegan: We have done three building and conditions surveys, plus we have had the RAAC surveying and questionnaire programme, so we know a lot more than anybody has ever known, including everybody on the Opposition Benches.

Alberto Costa: It seems that the risk of RAAC being present in two of my South Leicestershire schools is very low, but as yet it has not been ruled out. Would my right hon. Friend please confirm that she and her team in the Department for Education will work as fast as is reasonably possible to ensure that the schools affected are given the information they need to inform parents?

Gillian Keegan: I am not sure of the status of those two schools, but if their questionnaires have been provided and they are on the suspected RAAC list, there will be surveyors going in in the next couple of weeks. At that point, if they are identified as having RAAC, we will immediately take action similar to what we did last week with the 104. Parents will be informed immediately if that action has to be taken, but, as I said earlier, two thirds of schools that are suspected do not turn out to have RAAC.

Apsana Begum: Seven Mills primary school in my constituency was found to have RAAC following an inspection earlier in the year. It is a small school and has had to close its main hall, which is its biggest space. I visited the school last Friday and saw for myself the logistical challenges that the school leadership have had to overcome at such short notice to ensure that they can deliver teaching, school lunches and physical education from other spaces. While the school is not one of those most severely impacted by RAAC, I am concerned that schools in this category, which at present are able to remain open, will be left behind in capital works and in receiving the associating DFE funding and support for those works. Every school impacted by RAAC needs to be remedied as quickly as possible, so what assurances can the Secretary of State provide that schools that are currently able to remain open will not have to endure disruption for a longer period because they may be deemed a lower priority?

Gillian Keegan: It is our intention that all the schools remain open as much as possible and we expect that most of them will. I thank the headteacher and all of the staff at the hon. Lady’s school, because they have worked very quickly, they have done a lot to make sure that they move things around within the school system so that they can keep children learning and they have been flexible. If there is disruption that is incurring costs, or if they wish to access temporary accommodation or other costs, they can talk to the Department for Education and see whether they are eligible for that programme.

Several hon. Members: rose—

Eleanor Laing: Order. We have a problem with time here this afternoon, because we have a great deal of business to get through later today and I am aware that more than 30 people are still trying to catch my eye to ask a question. Normally, I would allow a statement to run for an hour. I will not curtail this statement after an hour, because I appreciate that every Member who is here has a specific problem to bring to the Secretary of State, but I ask, please, for short questions, which will allow the Secretary of State to give short answers. We have done all of the political bits, and we do not need any more of that—just the questions and the answers, please.

Ian Liddell-Grainger: Thank you, Madam Deputy Speaker—my question will be short. Multi-academy trusts are not getting in touch with MPs. Could the Secretary of State please ensure they do? I have two that are not in my constituency. That brings me to another problem: as the Minister for Schools, my right hon. Friend the Member for Bognor Regis and Littlehampton (Nick Gibb), is aware, Haygrove School in my constituency is a brand-new building that has now basically been condemned. The problem is that people think it is the cement. That building is two years old. I am afraid, Secretary of State, that decisions need to be made now about the building being re-done as soon as possible.

Gillian Keegan: My hon. Friend should have the details of schools in his constituency in a “Dear colleague” letter, and he can phone the helpline to get information on those schools. In addition, I am sure that the schools would appreciate him getting in touch. If he has any difficulty with that, I or my right hon. Friend the Schools Minister would be very happy to help him.

Justin Madders: One positive from this farce is that we should hear no more lectures from Conservative Members about us not fixing the roof when the sun was shining. How detailed and accurate will the list be when the Secretary of State produces it? I ask because she emailed me on Friday night saying that no schools in my constituency were affected—one may be a possibility—but on Sunday I heard from a headteacher who has had to make arrangements because RAAC had been discovered in their school. The Secretary of State tells me that no schools in my constituency have a problem, but I know for a fact that that information is incorrect, so can she give an assurance that, when it comes out, the list will be 100% accurate?

Gillian Keegan: It is very difficult to ensure 100% accuracy on a moving feast, but I will look at the case in question. We have caseworkers and a caseworker system, we have identified all the cases and the hon. Member should have all the details of all the cases in his constituency in the “Dear colleague” letter. If anyone does not have that, please contact me and the Schools Minister, and we will check it out.

Aaron Bell: May I thank the Secretary of State for giving such a measured and reasonable statement in these very trying circumstances? The timing is terrible, as she acknowledged, but it is right that we put children’s safety first. Can she confirm  that the reason the timing is terrible is that new facts have come to light, and that is why we have had to make the decision that we have?

Gillian Keegan: One hundred per cent. The new information, which came as late as towards the end of August, is what made us take a different approach. I did not want to do that—it was the last thing I wanted to do—but it was the right thing to do.

Abena Oppong-Asare: Can the Secretary of State confidently confirm for me that every school that has been identified as having RAAC has been contacted by the Government on what action to take?

Gillian Keegan: Yes, I can confirm that those that have been identified as having RAAC—there are two types: critical and non-critical condition—will have had action. We changed the action for the non-critical. Those that may be waiting are those with suspected RAAC, for which we will be doing surveys in the next two weeks. I am not sure whether the hon. Lady has a school in mind, but it could be in either of those categories.

Siobhan Baillie: The information that I have from my right hon. Friend the Secretary of State is that there are no confirmed cases of RAAC in Stroud schools, but three schools are taking surveys as a precautionary measure, and those surveys will be accelerated. Will she take this opportunity to reassure parents and schools? If they listen to the media or to those on the Opposition Front Bench, they will think that every school in the country is crumbling, which is absolutely not the case. Will she also talk to the Department about ensuring that headteachers get information ahead of the public and the media, because we know that that has not always happened, and it is important to families?

Gillian Keegan: My hon. Friend makes an excellent point. To put the scale into context, there are 22,500 schools in the country and 156 have been confirmed with RAAC. Of those that are suspected, which will go through the survey process, probably a third or less will be confirmed with RAAC. So it is important that we put that into context. We have taken tough decisions and the right action. The vast majority of parents, teachers and children will not be impacted by RAAC in our schools.

Clive Efford: What has been exposed is how close the Government were prepared to go to catastrophe in one of our schools before they took last-minute action this summer, just before schools went back. A school in my constituency has had to close substantial parts of its buildings. A letter from the DFE, following their discussions, says:
“As officials discussed with”
the trust
“the immediate actions should be treated as a short-term measure and you should already be developing a long-term plan for remediation of RAAC panels in your building.”
The next paragraph goes on:
“Please note the building survey in June 2023 was carried out as part of the DFE’s central RAAC Assessment Programme. As such, it should be considered in addition to, rather than in place of, any professional advice that you seek.”
Just exactly how will the Government determine what they will pay for? What work will they accept? Will it be the professional judgment of the people the schools engage, or will it be the surveyors from the eight companies that the Secretary of State has just spoken about? How will these matters be resolved going forward, because the devil in these things is always in the detail?

Eleanor Laing: Order. Before the Secretary of State answers, we are not doing very well on the short short questions, are we? Of course, it is up to colleagues. If the House decides that it wants to vote at midnight tonight, that is fine by me, but I think that it is probably not the consensus, so please let us take some action now: everybody look at what they have written down and cut it in half.

Gillian Keegan: I can confirm that surveyors registered with the Royal Institution of Chartered Surveyors are acceptable.

Greg Clark: The Secretary of State knows that in July I met the Minister for Schools, my right hon. Friend the Member for Bognor Regis and Littlehampton (Nick Gibb), when St James’ Primary School in my constituency was found to have RAAC. The headteacher Mr Tutt and his staff and governors have done a heroic job in finding space for the children and having works done during the summer to restore the classrooms. Will the Minister meet me straight after this statement to confirm that they now pass muster so that the school can reopen as planned?

Gillian Keegan: Yes, I can confirm that the Minister for Schools is doing a meeting with MPs after this, and he can meet after that. Those involved have done an excellent job, and I thank them all for the action that they have taken. We will, by the end of today, work with my right hon. Friend to ensure that we know how that can be finalised.

Alex Cunningham: There are conflicting reports about William Cassidi Primary School, St Michael’s Catholic Academy and Frederick Nattrass Primary Academy. The Secretary of State told me in her letter that they may have the dodgy concrete and that it could take weeks to survey them, but Stockton-on-Tees Borough Council says that no schools in the borough are affected and all remain open. How can school leaders reassure parents and the children themselves that they are safe in school when there is such conflicting information, and who is right?

Gillian Keegan: There should not be conflicting information. The “Dear colleague” letter will be right, because that school will have an assigned caseworker. That is a school that the hon. Gentleman thinks will be surveyed, so it is not one that has been identified so far—

Alex Cunningham: I named three schools.

Gillian Keegan: Okay. I will check that out on the hon. Gentleman’s behalf, but if the schools are going to be surveyed, it could be that the council does not know about it.

Greg Smith: In the face of changing evidence, the cautious approach is clearly the right one, but, as has been acknowledged, that leads many pupils, including some at Waddesdon School in my constituency, back into receiving online learning rather than the face-to-face classroom learning that they deserve, which, equally, has a knock-on impact on a small number of children when it comes to safeguarding.
Over the weekend and today, I have been in close contact with headteacher Matthew Abbott and his team at Waddesdon School, and so far, as of their call at 2 pm, they have not been offered direct assistance in getting temporary classrooms. Rather, they have been given the impression that they are to be left to their own devices in procuring their own under the usual public sector procurement rules, which are very onerous when it comes to renting things such as village halls or the Methodist church. Will my right hon. Friend intervene to ensure that Waddesdon School does get support on temporary classrooms, or, if it is left to its own devices, that the public sector procurement rules are made more lax when it comes to getting those facilities?

Gillian Keegan: The reason that we have deliberately spoken to and worked with three portacabin or equivalent providers is to avoid just that problem. If my hon. Friend gives us the details, we will follow up on that.

Stella Creasy: I fear that the Secretary of State will rue her boasts about her good understanding as a hostage to fortune in what is going on today. Late on Friday evening, she wrote to me to say that Walthamstow School for Girls was being surveyed for suspected RAAC. That was a source of deep frustration to my local authority, which, when it saw that there were national incidents, spent its own money surveying every school in our borough and then paid for the remedial works. It has told the Department for Education about that not once, not twice, but three times. When there is this little grip on what is going on, how can any parent, pupil or school staff member have any confidence? If the Secretary of State wants to know why people are laughing rather than saying that she is doing a good job, she needs to look in the mirror.

Gillian Keegan: I will take the hon. Lady’s advice and look in the mirror later. It is the responsible body’s job. If it has already gone ahead—as per the warnings we issued in 2018; we told everybody what they needed to do—I am delighted that it got on and did that work.

Dr Caroline Johnson: I thank my right hon. Friend the Secretary of State for the hotline that she set up. I am pleased to say that it has informed my office that no RAAC has been found in my constituency, but I welcome the work she has done to keep children safe where it has been found. The Sir William Robertson Academy in my constituency does not have RAAC, but it does have other structural issues and is in the school rebuilding programme. The Chancellor has said that the money required to repair the concrete will be available. Can my right hon. Friend confirm that that is new money, and that the rebuild of Sir William Robertson Academy will still  go ahead?

Gillian Keegan: I will have to write to my hon. Friend about that particular school, because I do not have the list of all the school rebuilding, but the intention is that for schools that have already been identified and announced it will still go ahead.

Christian Wakeford: I received an email from the Secretary of State at 7.15 pm on Friday, the weekend before schools were due to go back, advising that a school in my constituency might be affected, so the truth is that the Secretary of State does not even know. Can she advise when parents will know whether or not their children are safe at school, because this is not good enough, is it?

Gillian Keegan: They are safe in school. When I say that a school might be affected, that means it has been identified as containing suspected RAAC from the questionnaire that the responsible body has sent back. Those are the ones we will be doing the surveys on in the next two weeks. As I say, usually two thirds of them are not affected, but it sounds to me like the hon. Gentleman’s school is in that category, and we will be getting to it in the next two weeks.

Matthew Offord: When the issue of RAAC across the whole public estate was raised, I asked the Department what estimate it had made of the implications of its policies on the use of that material. On 25 July, I was told:
“It is the responsibility of those who run schools and who work with their schools day to day to manage the safety and maintenance of their buildings…The Department provides support on a case by case basis if it is alerted to a serious safety issue which responsible bodies cannot manage independently.”
Can the Secretary of State tell me who the responsible body was before this issue was brought to her attention? Was it the headteacher and the governing body, the local authority or the Department for Education?

Gillian Keegan: The responsible bodies are typically the local authority or the multi-academy trust, but it is fair to say that we have recently changed our approach to become more directly involved, to make sure we help schools and responsible bodies to move quickly on this issue.

Catherine West: I put on record my thanks to Hornsey School for Girls and the local authority, which do have a plan for students to return safely to school. My question is whether the money that was intended for the neighbouring schools—Fortismere, which is riddled with asbestos, and Highgate Wood School, which is desperate for a new sports hall as its current one is crumbling and Dickensian—will be used for Hornsey School for Girls? Is one part of the budget just going to be raided so that it can prop up a failing Government, a failing education service and a failing Education Department?

Gillian Keegan: I do not agree with the last couple of comments, but if the school has already been confirmed for the school rebuilding programme, that will continue.

Rob Roberts: Of course, education is devolved in Wales, but as the Secretary of State has rightly said, this is not a time for political point scoring,  nor is it really a time for jurisdictional squabbling. Given that this issue predates devolution by several decades, will she confirm that, should the situation arise in Wales, any remedial funding required to repair the buildings will still be provided by the UK Government?

Gillian Keegan: I think the Welsh Government will be providing the response to RAAC in Wales and also the funding for it.

Hywel Williams: As the hon. Member for Delyn (Mr Roberts) has just said, the schools that are suffering from RAAC were built before devolution and the advent of the Welsh Government and have been inspected properly by the local authority. The Secretary of State has said to the Welsh Education Minister,
“I stand ready to support you”,
yet the Chancellor has said that there is no new money. Might not the people of Wales, and the people of Holyhead and Menai Bridge in particular, feel her words as an empty political gesture?

Gillian Keegan: I think the hon. Gentleman knows that education is devolved in Wales.

Jake Berry: The Secretary of State has said on several occasions that she and her Department are prioritising pupils still accessing face-to-face learning. As that is the case, when she publishes her definitive list on Thursday, will she also publish an estimate of the number of pupils who are not able to access face-to-face learning, and will she commit to the House that she will update that estimate on an ongoing basis?

Gillian Keegan: I cannot promise my right hon. Friend that that information will be contained in what is published this week—which is more likely to be about the schools and the mitigations that are in place—but we will then put together the information on pupils who are learning face to face and those who are learning remotely, and we will update that regularly.

Cat Smith: The Secretary of State will know that people go into teaching because they have a passion for educating young people and giving them a brighter future. They do not go into teaching to become building managers, and given that over the past 13 years lots of caretakers and school building managers have been cut because of school budget cuts, what confidence does she have that the information she is getting from these questionnaires is accurate?

Gillian Keegan: It is the responsible body, not the schools, that is responding to the questionnaires. As the hon. Lady says, the schoolteachers are there to teach the children, but the responsible body will be responsible for filling in the questionnaires.

Philip Hollobone: I welcome the Secretary of State’s commitment to publish the list of impacted schools as soon as possible. She is urging responsible bodies that have not responded to the questionnaires to fill them in and return them, and she said that 5% had not done so. Could we not make it a  statutory requirement for responsible bodies to return those questionnaires, and will she think about publishing a list of those responsible bodies that have not done so?

Gillian Keegan: My colleague Baroness Barran has written to those responsible bodies again and requested that they respond to the questionnaires by the end of the week. We will then need to consider what we do with those from which we are still awaiting responses.

Layla Moran: I spoke with the chief exec of a local trust earlier today, and that trust’s top priority is how it is going to fund this work. I was worried to hear the words “reasonable costs” from the Secretary of State just now. Can she confirm that a list of what is considered reasonable costs will be published as soon as possible, and would that include heating, for example? Clearly, heating a portacabin over winter is going to be much more costly than heating a well-insulated classroom.

Gillian Keegan: Actually, the portacabins of today are very well insulated, but I would advise the hon. Lady that any particular case should be referred to the Department. The school can come directly to the Department with its revenue requests, and we will look at each one on an individual basis.

Alexander Stafford: Last year, it was announced that Wales High School, one of the largest secondary schools in Rother Valley, was part of the school rebuilding programme, with an investment of tens of millions of pounds to improve conditions for children. Does the Secretary of State agree that this Government have invested in rebuilding our schools, so that all of our children across the country have a better standard of education?

Gillian Keegan: Yes, I absolutely agree. Our school rebuilding programme is much more efficient and much cheaper. It comes complete with classroom walls, and it is definitely much quicker to build as well.

Karen Buck: How many of the schools affected are academy schools? Are any of them free schools or stand-alone academies? For those schools that are not directly accountable to the Department for Education, what support are the Government giving to local authorities and diocesan authorities? In cases such as that of the school affected in my constituency, it is the Church of England that is on the frontline, so it needs extra help as well.

Gillian Keegan: The Church of England is the responsible body for some of the schools as well. The schools affected were built between 1950 and the mid-90s—it is only schools built during that period—and we will work with all the responsible bodies.

Kevin Foster: If an expert in concrete advises that a building might collapse, it is an obvious call to say that children should not be taught in it, so the Secretary of State was absolutely right to make the decision she made last week. When it comes to ensuring timely and accurate information for local authorities and local representatives, how does she propose to make sure that local councils and local diocesan boards of education are kept fully updated, particularly as the results of surveys come forward?

Gillian Keegan: We intend to publish management information. As I say, the list that will be published this week will have the initial information about mitigations. We will publish more management information probably from the following week, and then we will regularly update it as cases move on and move off.

Kate Osborne: St James Catholic Primary School in my constituency had critical RAAC identified in June. Despite what the Secretary of State told the media this morning, this has not been immediately fixed, and the school is now closed. Ministers and the DFE guidance have been contradictory on funding temporary costs, and the school has been told to fund travel and temporary arrangements itself. This is not acceptable. Can she confirm a timetable for works to make schools safe, and that all costs will be fully funded? Finally, she made it clear earlier today that she does not consider this situation to be her fault or her responsibility, so maybe she can tell us who she thinks has been “sat on their arses”?

Gillian Keegan: I made the point to a journalist earlier— an off-the-cuff remark after the interview had finished—but I was responding to the fact that, in effect, the journalist had interviewed me in a way that suggested everything my fault; saying everything in 1994 was my fault, when I was working elsewhere. I pointed this out to the journalist, off the cuff—[Interruption.] No, I am not thin-skinned at all. It was something I said off the cuff.
On that school, which is a much more serious issue, some of the schools on the critical list were closed if they had a large degree of RAAC. Those children should be being accommodated, but if they are not and there is no plan to do so, the Department for Education will be paying for the mitigations that will be put in place.

Nigel Evans: Order. Can we please use temperate language?

Ben Bradley: May I offer  some reassurance to the House and to parents in Nottinghamshire? The county council has been working with the Department and schools for many months to get surveys in place to make sure we have an accurate picture of our school estate. As a result of that work, for which I am very grateful, the sum total of disruption in Nottinghamshire this week is the return of one primary school being delayed by a couple of days. That is a good result in the circumstances of this late change of guidance, so I am really grateful for that work and the support of the DFE.
There will no doubt be a massive run on the procurement of temporary buildings in the coming days and weeks, but there will also be existing temporary buildings on school estates that are underused or unused. Academy trusts will not naturally talk to each other about that, so would the Department consider helping to ensure that existing buildings end up in the most appropriate places at the right time?

Gillian Keegan: I thank my hon. Friend for that, and also for all the work that he and his council have done—they have been exemplary in getting on top of this issue. On temporary buildings, I am very happy to have a further discussion. At the moment we have three suppliers and a lot of stock, and we are getting ready to enable that to be used. If there is underused stock elsewhere, we will be happy to consider that.

Mohammad Yasin: In 2016, the Levelling Up Secretary admitted that his 2010 ditching of Labour’s Building Schools for the Future programme was one of his worst mistakes. In 2011, a High Court judge said that the cancellation of the programme amounted to an abuse of power. Despite years of warnings, the Government have done very little to ensure that our public buildings are safe. Is the Secretary of State ashamed of this record, and will she apologise to taxpayers, who want to know why they have to pay so much for so little?

Gillian Keegan: Absolutely not, and I would just like to point out to the hon. Gentleman that the Priority School Building programme schools were one third cheaper per square metre than those built under Building Schools for the Future, and that is a fact from the National Audit Office in 2017.

Emma Hardy: A new and much-needed special educational needs and disability free school for the East Riding was announced in March 2023. Can the Secretary of State confirm that there will be no delay in the building of this free school, and that she will not be following the advice of the former Department for Education permanent secretary who said that free school programmes should be “second to safety” and therefore at risk?

Gillian Keegan: I will look at the hon. Lady’s free special school, but we announced seven new free special schools in the summer holidays. This is very much part of our building of more places for special educational needs, which we know are badly needed in many constituencies.

Patricia Gibson: I wish to impress upon the Secretary of State the fact that repairs must not come from current education budgets, since in Scotland these budgets are already reeling from Labour’s appalling private finance initiative legacy, which sold out the taxpayer. Can she offer me an assurance that the UK Government will provide all necessary additional financial support to all affected schools in Scotland, such as the PE block in Ardrossan Academy in my constituency? While she is weighing up the funding issue, can I ask her to bear in mind that, in the last financial year, Scotland’s capital budget was cut by £185 million in the face of soaring inflation?

Gillian Keegan: I do sympathise with the hon. Lady. The PFI deals that were put in place all over the country, and which still blight the public sector today, are a hangover legacy of the last time Labour was in power. There is a very good reason why we should not trust it with our public services again.

Kevan Jones: I have two schools that are affected: St Bede’s in my own constituency; and St Leonard’s in the City of Durham constituency, to which a lot of pupils travel from my constituency and which has been closed. Parents I was speaking to over the weekend are both concerned about their education, and frustrated and angry, frankly, at the way the Government have dealt with this.
The Secretary of State said in her statement that her Department had been working all weekend. I spoke to one of her civil servants this morning—a very nice  gentleman, I have to say—and he told me nothing, frankly, because he had nothing to tell me. I also spoke to the head of St Bede’s school this morning, who made sterling efforts on Friday to try to get alternative provision in community centres and other buildings in the area, only to be told that the Department has to sign these things off. It is chaos, the way this is being dealt with in County Durham.
Can I just say something about St Leonard’s? If the funding earmarked for the rebuilding of St Leonard’s had gone through and not been stopped by this Government, who instead made the ideological decision in 2011 to bring a free school to the City of Durham, which then closed three years later, costing £4 million, that £4 million could have been spent on education in Durham.

Gillian Keegan: I thank the right hon. Gentleman, but just so that he is aware, and actually so that all Members are aware, this was announced on Thursday and today is Monday. In that time, we have identified the buildings, we have got the portacabins, we have written to everybody—

Kevan Jones: No, you haven’t—not in Durham.

Gillian Keegan: We have got the contracts for the portacabins. In a few days, we have actually stood up a helpline system and a caseworker system. I think the schools, working with the caseworker, will be getting all the mitigations in place, but it is a policy that was announced last Thursday.

Mary Foy: What happened last Friday was an absolute disgrace. My constituents were thrown into disarray when St Leonard’s school had to close. Is the Secretary of State aware of the difficulty and distress this has caused? Childcare and work had to be rearranged, all at the last minute and all against the backdrop of a cost of living crisis, so what support will be offered to those vulnerable pupils and families, especially those on free school meals? Will there be a promise of financial support for repairs to the school, and when can the school expect a timescale to make the school safe? I must say that the local authority and the Department for Education have been pretty useless, and I want to put on record my thanks to Durham University, which is stepping up and trying to be as proactive as it can to help solve this situation.

Gillian Keegan: Of course, for parents and for children this was very difficult. I have said that if I could have done it any other way, I would have done so. But faced with the information I had, I thought that was the best thing to do to keep children safe in our schools. I know the timing was very difficult. On the repairs, yes, I can assure the hon. Lady that there will be support, first, to mitigate whatever the situation is at St Leonard’s, and then in future when we look at whether it is refurbished or repaired.

Sammy Wilson: Thousands of parents will be concerned, at the start of a school term, at their children once again being locked out of school and not getting face-to-face teaching, because they know the consequences of this policy. We saw that during covid, when schools were closed down, and we are still living with the consequences for educational achievement,  the disproportional impact on the poor, long-term school absence, mental health problems and so on. I hope this is not going to be the default position of the Department for Education every time it identifies risk in a school. Could the Secretary of State tell us what discussions she has had with Northern Ireland officials, whether a number of schools have been identified in Northern Ireland and whether the approach in Northern Ireland is going to be that if the schools are identified, then they will be closed?

Gillian Keegan: We have written to Northern Ireland officials and offered support. It is absolutely our priority to minimise remote learning as much as possible. The right hon. Gentleman is absolutely right: we still see the impact on our children today. For the critical 52 schools that were mitigated, remote learning was needed for, on average, six days, but we are trying to minimise that as much as possible.

Paulette Hamilton: I have 40 schools in my constituency, which is one of the poorest in the UK; they simply cannot afford another crisis. They have faced austerity, coronavirus, energy bills and strikes. What support can be offered to schools and parents in Erdington who will be affected by this? Also, we have talked about other public buildings, so how will the right hon. Lady work to ensure that what has been learned from this will be passed on to other areas so that the same mistakes are not made again?

Gillian Keegan: If there are schools in the hon. Lady’s area, they will have been identified and we will be working with a caseworker to mitigate those as soon as possible; if there are suspected schools, we will be working to ensure that we survey them as soon as possible. On the point about the wider public realm, schools are obviously quite specific as there are many buildings—64,000 blocks—and most of them do not have an estate manager, so they are managed in different ways, but every Department has their own programme.

Nigel Evans: I call Jim Shannon.

Hon. Members:: Hear, hear.

Jim Shannon: Thank you, Mr Deputy Speaker. I was waiting for other hon. Members to hop in ahead of me, but there we are.
I thank the Secretary of State for the answers she has given. In her introduction, she referred to England, Wales and Northern Ireland, because there are issues in Northern Ireland as well. I understand that education is a devolved matter, but according to media reports at the weekend, Saintfield High School in my constituency is having some of the repair work done. What discussions have taken place in Cabinet to ensure that schools in Northern Ireland have the help and assistance they need to make safe their buildings? The restricted budget must take in the increased cost of these works in Northern Ireland due to the logistics of this very specialised work?

Gillian Keegan: As I have mentioned, we have written to officials in Northern Ireland and offered to have meetings to pass on information and best practice and to work with them closely.

Richard Burgon: We have all listened carefully to what Ministers have been saying. The Prime Minister said it was “completely and utterly wrong” to blame him for failing to fully fund a programme to rebuild England’s schools when he was Chancellor. But is it not in fact the case that what was truly completely and utterly wrong, and what is completely and truly wrong, is for this Prime Minister and this Government to pursue an ideological fixation with austerity, which has caused the lives of children in this country to be put at critical risk?

Gillian Keegan: I can give the hon. Gentleman some good news. We are going to be funding schools more than ever before: £60 billion a year, and the overall capital budget, as I have said, is £19 billion, and that is from the spending review in 2021, of which £7 billion is allocated to 2023-24. We have been building to continue at the same building rate of new schools for a long time.

Claudia Webbe: At least four schools in my constituency have been affected by the RAAC issue. The Secretary of State will be aware that Willowbrook Mead Primary Academy had to close without notice, with children being taught online. The Secretary of State’s letter warning about the danger arrived after children and staff had been back in dangerous buildings in Leicester for three days because schools there reopened a week earlier than most—the start of the school term in Leicester was last week. What does she have to say to the parents, carers and guardians in my constituency whose vulnerable children were put at risk by the Government’s lack of prompt action, investment and care?

Gillian Keegan: I am aware that, as the hon. Lady says, Leicester’s schools start a little earlier. However, the information on which we based our decision only really came forward at the end of August, so when we acted we had to act on new information, and that is what triggered the change. Of course, I am very sorry to parents and children because it has caused disruption to the start of their year, which was the last thing I wanted to do, but my priority is keeping them safe in school.

Nigel Evans: I thank the Secretary of State for her statement and for responding to well in excess of 60 Back Benchers for over an hour and a half.

Personal Statement

6.45 pm

Gavin Williamson: With your permission, Mr Deputy Speaker, I wish to make a personal statement regarding an exchange that occurred on 13 and 14 September 2022 between myself and the then Chief Whip, my right hon. Friend the Member for Aldridge-Brownhills (Wendy Morton). During this exchange I used intemperate and inappropriate language, which I regret and I apologised for shortly after. My behaviour led to a complaint. The complaint was initially dismissed by the Parliamentary Commissioner for Standards. However, this decision was appealed and subsequently reversed by the Independent Expert Panel.
I accept the decision that my conduct constituted a breach of the bullying and harassment policy, and have since reflected on my behaviour. I reiterate my apology made to the complainant following the breach. I apologise to them again now, and I apologise to the House fully and unreservedly. I will do my utmost to ensure this does not happen again.

Nigel Evans: Thank you very much.

Points of Order

6.46 pm

Debbie Abrahams: On a point of order, Mr Deputy Speaker. In a previous point of order on 12 July I said that I had not received a reply to the letter I sent to the Prime Minister on 17 January, and I can confirm that I had not received a response to that letter at that point. However, in the spirit of my Elected Representatives (Codes of Conduct) Bill, which aims to restore trust in our politics, I wish to clarify that I had received a separate response to my June follow-up letter to the Prime Minister from the noble Baroness Neville-Rolfe on 7 July, and I have written to her to make that clear and to thank her. As such, I would be grateful if I could amend the record.

Nigel Evans: I am sure the House is incredibly grateful that the hon. Lady has done so in such a speedy fashion.

Dawn Butler: On a point of order, Mr Deputy Speaker. It is important to note that anything said in this House is noted by Hansard in perpetuity. Can you please clarify whether it is in order for Members of Parliament to ask for their family history to be forgotten? The family of former MP for Eddisbury Antoinette Sandbach were deeply involved in the slave trade and amassed wealth as a result of this brutality. The former Member has threatened the University of Cambridge with legal action after an historian spoke of her ancestors’ role in the slave trade. While her recent public apology for their role is welcome and necessary, those who sit in this House should not use their position to silence those who shine a light on the horrors of the past.
On a related point, Mr Deputy Speaker, do you also agree it is important that Members co-operate fully with any research into parliamentarians’ links to the transatlantic slave trade?

Nigel Evans: I am grateful to the hon. Lady for her point of order and forward notice of it. I appreciate that she feels strongly about the importance of academic research into the transatlantic slave trade, as all of us in this House do, or should do, but the participation of individual Members and former Members in such research is a matter for those concerned and not the Chair. However, the hon. Lady has made her point of view known and it stands on the record.

Economic Crime and Corporate Transparency Bill:  Programme Motion (No. 3)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Economic Crime and Corporate Transparency Bill for the purpose of supplementing the Order of 13 October 2022 (Economic Crime and Corporate Transparency Bill: Programme), as varied by the Order of 24 January 2023 (Economic Crime and Corporate Transparency Bill: Programme (No. 2)):

Consideration of Lords Amendments

(1) Proceedings on consideration of Lords Amendments shall (so far as not previously concluded) be brought to a conclusion three hours after their commencement.
(2) The Lords Amendments shall be considered in the following order: 23, 151, 153, 115, 117, 159, 161, 1 to 22, 24 to 114, 116, 118 to 150, 152, 154 to 158, 160, 162 to 229.

Subsequent stages

(3) Any further Message from the Lords may be considered forthwith without any Question being put.
(4) The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—(Mike Wood.)
Question agreed to.

Economic Crime and Corporate Transparency Bill

Consideration of Lords amendments

Nigel Evans: I must draw the House’s attention to the fact that financial privilege is engaged by Lords amendments 6, 7, 9 to 12, 14 to 21, 30, 32 to 34, 54, 68, 115, 117, 120, 124, 125, 173, 174 and 178 to 201. If those Lords amendments are agreed to, I will cause the customary entry waiving Commons financial privilege to be entered in the Journal.

After Clause 46 - Register of members: information to be included and powers to obtain it

6.50 pm

Kevin Hollinrake: I beg to move amendment (a) to Lords amendment 23.

Nigel Evans: With this it will be convenient to discuss:
Lords amendment 151, and Government amendment (a).
Lords amendment 153, and Government amendments (a) to (c).
Lords amendments 115 and 117, and Government motions to disagree.
Lords amendment 159, and Government motion to disagree.
Lords amendment 161, Government motion to disagree, and Government amendment (a) in lieu.
Lords amendments 1 to 22 and 24 to 55.
Lords amendment 56, Government motion to disagree, and Government amendments (a) to (c) in lieu.
Lords amendments 57 to 114, 116, 118 to 150, 152, 154 to 158, 160 and 162 to 229.

Kevin Hollinrake: It is a pleasure to bring this Bill back to the House. It is crucial in ensuring that we can bear down on kleptocrats, criminals and terrorists who abuse our open economy, while also strengthening the UK’s reputation as a place where legitimate business can thrive. I am pleased to say that the Bill is now in a better place and there is a great deal more of it than when it left for the other place back in January. When introduced, the Bill ran to some 239 pages; it is now closer to 400. That reflects the spirit of genuine collaboration across both Houses and the fact that the Government have listened and taken many sensible proposals on board. I take this opportunity to thank Members of both Houses for their collaborative and cross-party approach.
The Government made significant amendments to the Bill in the other place. It is now unquestionably a milestone piece of legislation that takes the UK’s fight against economic crime to an entirely new level. I will summarise a few key changes, starting with the game-changing reforms to corporate criminal liability. As the Minister for Security, my right hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat), committed to, the Government tabled amendments to introduce a  new failure to prevent offence, which will drive cultural change towards improved fraud prevention in organisations and, failing that, hold organisations to account with prosecutions if they profit from fraudulent actions.

Layla Moran: I thank the Minister for giving way so soon. It is undoubtedly a positive thing that failure to prevent, or at least part of it, has now been included in the Bill, but does he have any sympathy for those warning that because this measure is targeting the larger firms, the small boutique firms—the one-man bands that are very aware of what they are doing and know how to get around the system—will still be allowed to freely operate? Would he consider supporting the Lords amendment that would close that particular loophole?

Kevin Hollinrake: I will speak in detail to the various amendments, including the non-Government amendments, one of which is on the threshold that the hon. Lady refers to. If I may, I will defer addressing that until later in my remarks.
The Government have also introduced reforms to the identification doctrine for economic crimes to make it easier to prosecute corporations in their own right for these offences. The House will know that this is the largest and most meaningful change to corporate criminal liability in decades. It will have a transformative effect on our ability to hold corporates to account for the actions of criminal individuals. I thank my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland) and my hon. Friend the Member for Bromley and Chislehurst (Sir Robert Neill) for all their work and engagement to further the cause for the reform of corporate criminal liability.
We have also made amendments to tackle strategic lawsuits against public participation, known as SLAPPs, that feature economic crimes. We believe that this is the first national legislation in the world to combat SLAPPs. The new clauses will enable an appropriate, fair and effective early dismissal procedure against SLAPP cases. I very much thank the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) for his work in this area.
Members will also be pleased to hear that the Government have tabled amendments to improve the new statutory objectives for the registrar of companies, and I hope my hon. Friend the Member for Barrow and Furness (Simon Fell) and the hon. Member for Feltham and Heston (Seema Malhotra) in particular will welcome these improvements, given their previous amendments.
We also recognise the points made by several Members of this House, as well as in the other place, about the role of authorised corporate service providers in the identification process, and we have tightened the framework. Our amendments will improve the transparency of ACSPs, including by requiring verification statements made by ACSPs when they carry out ID verification on behalf of an individual to be made publicly available on the register.
Furthermore, we have tabled a number of important amendments to strengthen and increase the transparency of the register of overseas entities, which I trust the hon. Member for Aberavon (Stephen Kinnock) and the right hon. Member for Barking (Dame Margaret Hodge) will welcome, given the amendments they proposed in Committee. I must pay tribute to my ministerial colleagues  Lord Sharpe of Epsom, Lord Johnson of Lainston and Lord Bellamy for all the work they have done to get this important Bill to where it is now.

Jim Shannon: May I thank the Minister? He always brings his points of view to the Chamber with clarity and helpfulness, and that is appreciated by everyone, including me.
We as a party are of a mind to support the Government on this Bill tonight. I want to ask a question that is probably very specific. It relates to Northern Ireland, where criminal gangs—that is what they are; they masquerade as paramilitaries, but they are criminal gangs—delve into business and economic crime. I am seeking assurance from the Minister—I think he probably will respond positively, but at the same time I seek to get his response on the record. Will this Bill ensure that criminal gangs that use illicit money and launder money from across the whole of Europe and further afield will be accountable, by ensuring that we can catch them, detain them and put them in jail?

Kevin Hollinrake: I thank the hon. Gentleman for his work and his intervention. It is clear that fraud and money laundering are already criminal acts; what the Bill principally does is help to prevent fraud by requiring organisations to make sure that fraud is not happening within them in the first place. I think he has spoken to that in the past, as have I as a Back Bencher. I fully support it as the Minister concerned, and I absolutely believe that the Bill will have a major impact in clamping down on economic crime.
We must do more to tackle crime, but we must also ensure that the UK remains a great place to start and grow a business. As such, the Government strongly oppose putting additional burdens on legitimate business, unless there is a clear rationale for doing so. Any amendments made to strengthen the Bill have been carefully weighed up, and the Government are confident that we have struck the right balance in tackling economic crime and preserving the UK’s welcoming business environment.

Jeremy Wright: I know that my hon. Friend will come on to make points about failure to prevent offences in relation to burdens on small businesses. May I tell him first that I welcome wholeheartedly the arrival of failure to prevent offences? Like my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland), I have argued for that when I was Attorney General and since, and I am glad to see it. In relation to failure to prevent and Lords amendment 151 in particular, the Minister will wish to argue that he is seeking to prevent excessive burdens on smaller organisations by limiting that offence to large organisations, but can he explain why subsection (4) of the new clause introduced by Lords amendment 151 does not do that job? It states:
“It is a defence for the relevant body to prove that, at the time the fraud offence was committed…the body had in place such prevention procedures as it was reasonable in all the circumstances to expect the body to have”.
Why would one of those circumstances not be the size and capacity of the organisation in question?

Kevin Hollinrake: I thank my right hon. and learned Friend for his point and his work in this area. I will come on to that amendment, if I may, later in my  remarks. He makes a valid point, and we want to ensure there are no loopholes while at the same time maintaining the position that the Bill does not put new burdens on businesses that are not likely to have a systemic effect on economic crime.

Richard Fuller: I interrupt my hon. Friend to pick up the intervention he received from my right hon. and learned Friend the Member for Kenilworth and Southam (Sir Jeremy Wright). I warn those on the Front Bench about what he just said. Leaving the burdens on business to the courts or whichever procedures to define is not a reasonable protection for small businesses. They need the protection that the Minister outlines, because in such circumstances people will go to the most conservative position they can. Although my right hon. and learned Friend suggested that that would provide significant and effective protection, it will not do so in practice as behaviour will change and burdens will increase. I think the Minister is getting the right balance on this.

Kevin Hollinrake: My hon. Friend makes the other point, and these measures are about the delicate balance that we want to strike, ensuring that the right provisions are in place to prevent fraud without putting undue burdens on business. I am pleased that those interventions reflected both those positions so that we can see the legislation holistically rather than just through the lens of failing to prevent fraud.

Margaret Hodge: Will the Minister give way?

Kevin Hollinrake: If I may, I will make a little progress on that point.
We believe that the six non-Government amendments for debate would pose significant and disproportionate burdens on business, penalising reasonable companies and businesspeople with limited evidence that the burdens would be outweighed by any meaningful benefits. I will go into each amendment in detail, but I will begin by emphasising the Government’s position. We must insist that the balance achieved in the Bill through Government amendments made in the other place is maintained.

Margaret Hodge: I am grateful to the Minister for saying that, because it was on that point that I wanted him to give way. Does he not think that any honest, upright business, whether large, small or micro, would aim within its own procedures to avoid fraud or money laundering?

Kevin Hollinrake: The vast majority of the business community is honest and upstanding—that is the point. What we are trying to ensure is that those businesses are not disproportionately affected by putting in controls, checks and balances. I speak as a businessperson who did have to implement failure to prevent bribery and tax evasion measures in our business, and I tell the right hon. Member that there were significant administrative burdens around that legislation, and I believe they would be more so for fraud. I will come to that point in more detail.
I turn to Lords amendment 23. The inclusion of lines 84 to 96 would require all UK companies to declare whether they are holding shares on behalf of or subject to the direction of another person or persons as a nominee, and if so to provide details of the person or persons. Fundamentally, that is not necessary. Provisions in the person with significant control framework, as strengthened through the Bill, already require the disclosure of a person of significant control behind a nominee on pain of criminal sanction for non-reporting. That achieves the same intent. A combination of measures already in the Bill, the material discrepancy reporting regime in the Money Laundering and Terrorist Financing Regulations 2022 and Companies House’s new intelligence hub will more effectively flush out undeclared PSCs and deter the provision of false information.
I am afraid that the proposed approach is something of a blunt instrument. It would apply to all shareholders, when we should be focusing on the transparency of individuals exerting significant influence as already provided for under the PSC framework. As such, we would risk burdening millions of companies and their shareholders with new information requirements for no useful purpose. The proposition may sound sensible, but nominee arrangements can be complex, including having multiple layers of nominees and large numbers of beneficiaries for entirely legitimate reasons. For example, pension funds that own shares in a company would be caught. Listed companies would be particularly impacted as their shares are often held by nominee arrangements for legitimate administrative reasons—for example, in stocks and shares individual savings accounts, by custodian banks and by corporate sponsored nominees.
Listed companies report similar information about those owning 3% or more of their shares to the Financial Conduct Authority, so the Lords amendment would partly duplicate existing arrangements. In summary, lines 84 to 96 of the amendment risk disproportionate burdens on legitimate actors and would most likely be ignored by illegitimate actors. Those acting as nominees on behalf of shady individuals behind the scenes are already adequately on the hook if found to have provided false information, as is the company itself.
The effect of inserting those lines into part 8 of the Companies Act 2006 would be to cut across a tenet of UK company law: those running a company—usually the directors—must know its legal owners and act in the interests of the legal owners of the company. Those legal owners are recorded on the register of members. Companies shall have regard to their members record and not, for example, to anyone holding any underlying beneficial interest in their shares.
Lords amendment 115 would introduce two new duties for overseas entities. It would first require event-driven updates on beneficial ownership information and, secondly, require overseas entities to update their record no more than 14 days before the completion of a land transaction rather than the existing requirement to do so annually. Although the amendments are well intentioned, they would significantly increase burdens on both overseas entities and third parties transacting with them, as well as introduce an element of risk in land transactions that the annual update prevents.
As my ministerial colleague Lord Johnson of Lainston explained in the other place, in the case of an overseas entity that owns large commercial premises split into units, the amendment could result in the entity needing to provide updates twice a month, which is a disproportionate burden. There are a number of other technical challenges and impracticalities with setting such a duty on these entities. The Government are not alone in those views. The Law Society of Scotland, the Law Society of England and Wales and the British Property Federation have all expressed their concerns. The Government therefore cannot support the amendment.
Lords amendment 117 would make information about trusts submitted to the register of overseas entities publicly available by removing it from the list of material listed as unavailable for public inspection. It is important to note that the information on trusts is already provided to the registrar when an overseas entity registers on the register. Furthermore, the registrar already discloses trust information to His Majesty’s Revenue and Customs, law enforcement and other persons with functions of a public nature if and when necessary and appropriate. This is not a loophole.
In the other place and in this House, including from the right hon. Member for Barking, the Government have heard and acknowledged that there is a case for broader transparency over trust arrangements beyond law enforcement agencies. The Government therefore added a regulation-making power in the law to allow third-party access to trust data in certain circumstances. That will enable individuals such as civil society organisations and investigative journalists to access such information under certain circumstances.

Liam Byrne: I am grateful to the Minister for his thanks for the progress we have made together on SLAPPs. Because of the amendment made on SLAPPs, we are now providing journalists and other truth-tellers with important protections when it comes to investigating economic crime. The Lords amendment is a complement to that. The truth is, there will never be enough enforcement resources for Companies House, HMRC and others, so we do need civil society to be able to bring the disinfectant of sunlight and undertake investigations. It is therefore vital that trust information is provided. Has he seen the new research published by Arun Advani, Andy Summers and their colleagues that shows that the current arrangements shield something like 152,000 properties from that transparency? If we genuinely want to be able to investigate where things are going wrong, where there is corruption, surely it is in the national interest for us to make that information more widely available.

Kevin Hollinrake: I thank the right hon. Member for his intervention. I have seen the report and the media release around it and we do not accept those numbers or the interpretation of beneficial ownership used in drafting the report. Nevertheless, we share his concerns and absolutely want to ensure that transparency will be greater than it is today.
The Government have every intention of exercising the power and intend to ensure that access can be granted in a straightforward way. Information currently held by Companies House was submitted by overseas entities in the expectation that it would not be available  for public inspection. Making such information available for public inspection would come with a number of risks, including the possibility of legal challenge. Moreover, publishing the data by default would likely have significant unintended consequences, including potentially exposing information about vulnerable individuals and minors. It is therefore right that the Government take the time to consult properly on this important issue to address the benefits and risks of greater transparency and how this can be achieved.

Nick Smith: On transparency and trustees, the Minister says that he does not accept the estimate of 150,000 properties that ought to be looked at in more detail, as my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne), said. What is the Government’s estimate of the properties that need transparency?

Kevin Hollinrake: Around 3,000 entities have not properly registered at this point in time. Enforcement action is being taken on them: some 100,000 communications already have gone out to those particular entities, and a number of fines have been issued—about half a million pounds in fines so far. We do not accept those numbers. We are happy to have a conversation with whoever has concerns about the legislation so far. We do not want legislation that cannot be properly enforced and implemented. It is important that we compare like-for-like to ensure this legislation is fit for purpose.

Chris Bryant: I may have misheard, but I think the Minister said that enforcement activity is going on against 100,000 companies—he will correct me when I sit down—and that there have been half a million pounds-worth of fines. That would be £5 a company, would it not?

Kevin Hollinrake: It would be if the hon. Gentleman’s numbers were right, but that is not what I said. Three thousand entities are not currently registered, to our knowledge. Many of those will have already ceased to exist or will have disposed of the property they owned. We are trying to find out the exact numbers. That is about the enforcement action. We have had 100,000 communications with those 3,000 entities, and half a million pounds of fines so far, but those fines can rise exponentially if they continue not to comply properly with the legislation.

Liam Byrne: The Minister has wisely equipped himself with an order-making power, which he referred to earlier. He told the House that he plans to undertake a consultation. It would be of comfort to some in the House—not to all—if he could tell us when he plans to launch that consultation and, in his own mind, when he would like the consultation to be implemented through the power with which he has equipped himself.

Kevin Hollinrake: We intend to launch the consultation by the end of the year, and we would like the regulations in place as soon as possible. It is quite clear that we want to do that. We all agree on the transparency—I agree with the right hon. Gentleman’s point that sunlight is the best disinfectant. I am absolutely keen to do it, but we must make sure we do it right. We do not want any unintended consequences. It is right that we consult  widely with the different sectors to make sure that this legislation—and the regulations, when they come—are fit for purpose.

John Penrose: When my hon. Friend does his consultation, will he reassure those of us who are anxious to maintain the distinction between significant control and general beneficiaries? If he is going to try—rightly—to protect minors for example, who he mentioned in his earlier remarks, will he focus on people who may be misusing trusts because they have control of them? That might be trustees—in some cases it could be beneficiaries if they have effective control of the trustees as well, but in many other cases it will not. Will he try to make sure that he makes that distinction? It is absolutely essential and reads directly across from the persons of significant control legislation that we have elsewhere in disclosing information about shareholdings as well.

Kevin Hollinrake: I thank my hon. Friend for all his work in this area. He makes the point very well. We need to ensure that when we bring forward these measures, they are properly considered and do not result in unintended consequences. He may want to raise those points as part of that consultation when we launch it.
The Government firmly believe that their own amendment and their commitment to consult better achieve the aim of improving trusts’ transparency, as intended by Lords amendment 117, while ensuring that we have time to analyse and stress test the risks in greater depth, including legal risks. We therefore do not support the amendment.
Lords amendment 151, in effect, removes the threshold, as right hon. and hon. Members have already raised, that the Government introduced as part of the failure to prevent offence, which exempts small and medium-sized entities. As I have set out, the Government are extremely mindful of the significant pressures that small companies are under, and do not want to place unnecessary and duplicative burdens on legitimate businesses.

Robert Buckland: I agree that we have made huge progress on the Bill, but why is the threshold on small businesses not present in the failure to prevent bribery and tax evasion offences? They are alike offences that have caused a regulatory burden to already exist. What difference will the Bill really make? Why are we not giving it the full fat treatment?

Kevin Hollinrake: I think there is a difference in the regulatory burden of failure to prevent fraud versus failure to prevent bribery and tax evasion. It is more complicated to do it, so it would have a much greater impact on SMEs than bribery and tax evasion. It is a balance of risk and benefits when making sure where those regulatory burdens sit.
If the threshold is not reinserted, the new offence will apply to every single UK business and therefore increase the cumulative burden on UK businesses more than eightfold, from just under £500 million to £4 billion. That burden would disproportionately be shared by small business owners. All Members of this House will have hard-working businesses in their constituency, so we cannot support that. It cannot be taken in isolation;  we must be aware of the cumulative compliance costs for SMEs across multiple Government requirements or regulations.

Margaret Hodge: I hear the Minister’s plea on behalf of SMEs, and I have sympathy that we do not want to overburden them with regulation, particularly small businesses. However, the threshold that the Government have chosen to set for exclusion from the failure to prevent fraud is extremely high. If I take just one example, law firms—he will know as well as I do that lawyers are among the key enablers of many schemes that lead to both fraud and money laundering—out of the 10,400 law firms in the UK, only 100 will be caught by the legislation as it is currently framed. Is he willing to negotiate with us on the Back Benches and members of the House of Lords to look again at the level at which he defines an SME in this legislation?

Kevin Hollinrake: The threshold is set at one of these three: 250 employees, £36 million turnover or £8 million in gross assets. We think that is the right level. We always listen to what the right hon. Lady has to say. The legal sector is covered by current money laundering regulations, as is the estate agent sector, for example. It is not right to say that they are not covered by money laundering regulations.

Liam Byrne: The Minister is being characteristically generous. I, too, respect what he is trying to do with the regulatory burden. I have taken a business from two people and a business plan and grown it into a multi-million pound organisation, so I respect what he is trying to do on regulation. However, does he not risk the growth of businesses with a turnover just below £36 million—perhaps £35 million—explicitly set up to be the conduits for bad behaviour? He will remember at the public Bill evidence sessions that representatives from the financial services community told us about the way in which money came into a bank and was split up between several different organisations and their bank accounts to blur what was really going on before the money went on to be laundered. Is there not a risk that clever people who are corrupt will just set up a whole hive of small businesses with a turnover below £35 million, to circumvent the safeguards that we are all trying to put in place?

Kevin Hollinrake: I do not accept that. It would be extraordinary if someone set up a business just for the purpose of keeping turnover below £36 million. Besides, it is already much easier to pinpoint fraud in small organisations than larger organisations. That is already the case. It is easier to take forward those kinds of prosecutions on that basis.

Robert Buckland: My hon. Friend is being very generous. I have two points on that. First, I take the point that the Government amendments have already mitigated the issue about parent companies and the division into subsidiaries—that is welcome. But the threshold has been taken from modern day slavery legislation. What is the separate rationale for that threshold in the context of economic crimes? I have not heard any.
Secondly, money laundering is already a criminal offence under the Proceeds of Crime Act 2002, just like fraud, false accounting and theft. Why on earth are we conflating the regulations that are all about neglect,  which are used by the FCA admittedly on some major cases, but not that often, with what is already a criminal offence? Why can we not just extend money laundering, which already is part of the regulatory burden of businesses in any event?

Kevin Hollinrake: I will come to the point about money laundering and broadening the sectors that money laundering regulation applies to, but, on SMEs, in my experience, in the work I did as a Back Bencher and in the work others have done, every case of fraud or money laundering I have seen has been by larger companies, not small companies. A number of cases the Serious Fraud Office has tried to take forward have been against larger companies, which is where the failure to prevent requirement comes in. It is much easier to take forward—

Robert Buckland: rose—

Kevin Hollinrake: I will just finish my point.
It is much easier to take that forward where the failure to prevent offence comes in, of course. The act of money laundering is a criminal offence—of course it is—and the act of fraud is a criminal offence. This is about a failure to prevent those activities and imposing that would, in our view, impose a significant regulatory burden on businesses.

Robert Buckland: I am grateful. The Minister is right to cite the SFO, but he knows that the threshold the SFO applies is very high. It will only prosecute high-value, complex or novel cases. It does not deal with the warp and woof of fraud in this country. He is right to say that the majority of this fraud is committed by byzantine, large organisations, but I have to ask him again: what is the regulatory burden? We know that companies already have to face regulations anyway. We have failure to prevent offences. Why is it—I suspect it is the hand of the Treasury, with respect to him—that the Treasury is trying to hold things back on this offence?

Kevin Hollinrake: My right hon. and learned Friend says it is the Treasury. Actually, I am responsible for the business framework and I am concerned about putting £4 billion of regulatory burdens on businesses. That burden has been calculated in the same way that we calculated the burden for bribery, so I think it is a figure we can rely on. Our natural position is that we do not regulate businesses that would find it more difficult to deal with that regulation. That tends to be SMEs. They might find it more difficult to deal with regulation, rather than larger companies, where it is easier to put those controls in place.
We have heard arguments that the threshold means 99% of companies will not be in scope, but we do not think the number of companies is the right metric by which to assess the effect of the new offence. We believe economic activity is more appropriate. I can assure the House that 50% of economic activity would be covered by the organisations in scope of this new offence with the threshold in place. It is, of course, already easier for law enforcement to prosecute fraud in smaller organisations that fall below the threshold. Given those factors, the Government cannot support the amendment.
Lords amendment 158 seeks to introduce a failure to prevent money laundering offence. The UK already has a strong anti-money laundering regime which requires the regulatory sector to implement a comprehensive set  of measures to prevent money laundering. Corporations and individuals can face serious penalties, ranging from fines to cancellations of registration and criminal prosecution if they fail to take those measures. The money laundering regulations and the money laundering offences in the Proceeds of Crime Act are directly linked and can be seen as part of the same regime. A failure to prevent money laundering offence would be hugely duplicative of the existing regime. In our conversations with industry, it has been very clear that that duplication would create a serious level of confusion and unnecessary burdens on businesses. We should be supporting legitimate businesses, rather than hampering them with overlapping regimes. The Government therefore do not support the amendment.
Lords amendment 160 would prevent enforcement authorities from having to pay legal costs in unsuccessful civil recovery proceedings, subject to certain intended safeguards. This type of amendment would be a significant departure from the loser pays principle and therefore not something we should rush into without careful consideration. The risk of paying substantial legal costs is just one of a multitude of factors that inform an operational decision to pursue an asset recovery case.
Several hon. Members and noble Lords have pointed to the similar changes made to the unexplained wealth order regime by the first economic crime Act, the Economic Crime (Transparency and Enforcement) Act 2022. The key difference is that UWOs are an investigatory tool that do not directly result in the permanent deprivation of assets, whereas civil recovery cases covered by the amendment could do so. There could, therefore, be a host of serious unintended consequences of such a change to the wider civil recovery regime, so the Government cannot support the amendment. However, we recognise the strength of feeling on the issue and the potential merits of reform. We have therefore tabled an amendment in lieu which imposes a statutory commitment to review the payment of costs in civil recovery cases in England and Wales by enforcement authorities, and to publish a report on its findings before Parliament within 12 months.
I hope the House is assured that the amendments the Government have laid are minor but sensible tweaks to the Bill. As I have set out, the Government have listened and made substantial important amendments to the Bill throughout its passage, significantly improving and strengthening the package where we recognise improvements could be made and where it makes sense for businesses. We must now, however, stand firm where we believe the amendments will not work or will place disproportionate burdens on businesses. I very much hope Members will support our position today and that the other place will note the Government’s movement on cost protection and reconsider its position on the six amendments when the Bill returns there. We must get on with implementing the vital measures in the Bill without further delay.

Seema Malhotra: It is a pleasure to speak in this debate on behalf of myself and my hon. Friend the Member for Aberavon (Stephen Kinnock). I thank the Minister for his opening remarks, and for the call last week with him and his officials. I thank the officials, pay tribute to their work on the Bill, and thank all those who have supported and taken part in the Bill’s proceedings.
We are in no doubt about the importance of the Bill. Britain has become a global hub for dirty money. The cost of economic crime now runs to as much as £350 billion, equivalent to our annual health and education budgets combined. Economic crime hits our constituents and our businesses. It hurts our public finances and it damages our reputation around the world. Action on economic crime was first promised in 2016, then 2018 and 2019. It matters because in the years from 2016 we saw a significant increase in economic crime, much of which could have been prevented if the Government had acted then. It took the invasion of Ukraine for the Government to step up. Strengthening the law has been urgently needed, which is why the Labour party has actively supported the Bill’s important passage through both Houses and sought to ensure that we leave no loopholes unchecked. Where the Government fail to act, we will.
We recognise that the Bill has made real progress in strengthening the law to tackle economic crime and its enablers. I particularly thank my right hon. Friends the Members for Barking (Dame Margaret Hodge) and for Birmingham, Hodge Hill (Liam Byrne), my hon. Friend the Member for Rhondda (Sir Chris Bryant), and the all-party parliamentary groups on anti-corruption and responsible tax and on fair business banking for their research and relentless campaigning for change. I also thank other Members who have made significant contributions to our debates, including some who are here: the hon. Member for Cheadle (Mary Robinson), the right hon. and learned Member for South Swindon (Sir Robert Buckland) and the right hon. and learned Member for Kenilworth and Southam (Sir Jeremy Wright). The Bill brings significant reform of Companies House, improving the accuracy and transparency of the register, with new powers for the registrar to become a more active gatekeeper over company creation.
Let me speak first to Government amendments which we support. I congratulate the Minister on the number of U-turns on areas that Labour argued for in Committee and on Report, including on closing loopholes around third party enablers and introducing a failure to prevent fraud offence. We welcome Government amendment 1, passed in the other place, which would expand the scope of objective 2 in clause 1, requiring Companies House to also take into account the accuracy of information already on the register before the Bill comes into effect. Government amendments 35 to 50, which all relate to the authorisation of corporate service providers, are vital amendments, especially amendment 35, which requires the registrar to publish the name of the authorised corporate service provider who has carried out ID verification. We welcome amendment 43, which requires the registrar to refuse the application for authorisation as a corporate service provider if it appears that the applicant is not a fit and proper person to become an ACSP.
Government amendments 146 to 150 introduce further provisions limiting SLAPPs that feature economic crime. I particularly thank my right hon. Friend the Member for Birmingham, Hodge Hill for his advocacy on this issue throughout the passage of the Bill and in Committee. SLAPPs are a form of abusive proceedings. It is for us to send a signal and to change the law in the public interest. I would, however, ask the Minister for clarity on the Government’s intention to cap costs via secondary legislation, set out in one of the Bill’s factsheets. It would  be helpful if he could give us an idea of when the Government are considering doing that, and how quickly he expects it to happen.
Lords amendments 151 to 158 introduce an offence of failure to prevent fraud, which I know was a priority for the Minister as well before he took on his present role. This is a huge step forward, which also follows considerable pressure and work between the Government and both the Opposition and their own Back Benchers throughout the Bill’s passage. The amendments take us forward, but the evidence shows that we need to go further, which is why we will support Lord Garnier’s amendment 159.
Lords amendment 124, tabled by the Government, deals with tackling opaque company ownership through the use of trusts. While any commitment to action is welcome, we fear that the amendment simply kicks the can down the road by leaving access to trust information to be sorted out in secondary legislation, without providing any meaningful detail or certainty as to how this will work in practice. We therefore call on the Government to support a non-Government amendment, Lords amendment 117, for reasons that I will explain later.
Let me now turn to the six important non-Government amendments. They include provisions that improve shareholder transparency, seek to close trust loopholes, expand the scope of the new “failure to prevent” offence, and extend cost caps for civil recovery cases. I thank the Lords for all their extraordinary scrutiny of the Bill, particularly Lord Agnew, Lord Vaux and Lord Garnier, as well as my colleagues Lord Coaker and Baroness Blake, among others.
Let me deal first with Lords amendment 23, tabled by Lord Vaux. As he explained, one of the classic ways in which to hide the real ownership of a company is through the use of undisclosed nominees arrangements, when a shareholder is named on the register but is in fact holding the shares on behalf of another person. In simple terms, the amendment aims to close that loophole by making it a requirement for shareholders to state, as well as their name and address, whether they are or are not acting as a nominee. If they are acting as a nominee, they will have to provide the name and address of the person on whose behalf they are holding the shares. The Government’s argument against the amendment is that the existing “persons of significant control” declaration threshold and legislation would lead to those nominees effectively being declared.
At present, while companies must try to identify persons with significant control, all they are really asked to do—as Lord Vaux explained—is look at the shareholder register. If there is no shareholder with 25% or more, they can reasonably conclude that there is no person of significant control, but if there is no obligation for the person who is acting as the nominee to disclose on whose behalf they own shares, PSC identity can remain hidden. It is far too easy for dishonest actors to hide their identities. The company concerned has the right to ask the nominees, but if the company is controlled by a dishonest actor, it is unlikely to do so. The amendment deals with that issue at its root, seeking full transparency over owners hiding behind nominees  for illicit purposes, but instead of strengthening legislation here, the Government are watering it down. They have tabled amendment (a) to Lords amendment 23, which would remove the requirement to declare if a person is holding shares as a nominee, thus essentially removing the primary principle of the original amendment. We need Lords amendment 23, and we will vote against amendment (a).
Lords amendment 115 creates an obligation for the register of overseas entities to be updated within 14 days of an entity’s becoming aware of any change, bringing it into line with the “persons of significant control” register. We have expressed concern previously about the fact that the register of overseas entities is one of the only registers that are required to be updated annually, rather than when a change occurs. This means that, at best, the register is providing only a snapshot of land ownership by overseas entities. We support the sentiment behind Lords amendment 115. Twelve months is certainly too long, and there is a significant risk that if the legislation goes through in its current form, overseas entities may be able to make changes within the 12-month period but change them back before their annual reporting requirement in order to evade transparency. There has been no solution to that loophole, but we need one. That solution, and a more appropriate threshold, need to be addressed, and with an evidence base. I do note the concerns expressed by the Law Society and others about the current amendment. We will not be voting on Lords amendment 115, but we believe that the Government must look again at instituting a period informed by data and analysis which will close this evident loophole.
Lords amendment 117 was tabled by Lord Agnew—who, I remind the House, resigned from his role in Government tackling fraud because of the Government’s “lamentable track record” in this area. We must be driven by the principle of maximum possible transparency. The amendment would require Companies House to publish information about trusts controlling offshore companies holding land in the UK, which is vital for transparency of land ownership. This amendment is much stronger than Government Lords amendment 124, which kicks the can down the road when it comes to acting on trusts by prompting yet another consultation. New research published by a group of academics from the London School of Economics and Warwick University on the register of overseas entities has found that the true owners of more than 100,000 properties in England and Wales controlled via overseas shell companies are not public, despite the rules that came into force on 31 January. Analysis of the register by Transparency International shows that trusts are used to hide the ownership of about 7,000 entities, which is about a quarter of those on the register. Trusts are also notorious for their use in sanctions evasion, a case in point being last year’s story of Alisher Usmanov’s allegedly using trusts to obscure the beneficiaries of his £170 million UK property portfolio.
I have heard some of the Government’s arguments in the Minister’s speech, but it still seems to me that on the issue of trusts we are dragging our feet when the time to act is now, and we will therefore oppose the Government’s motion to disagree with Lords amendment 117.
The Government have tabled amendment (a) to the new clause entitled “Failure to prevent fraud” in Lord Garnier’s amendment 151. As we have said, we welcome the steps taken by the Government on failure to prevent fraud,  but there are two problems with the current offence, about which the Minister has already heard during the debate: first, it applies only to large organisations as defined in the Companies Act 2006, and secondly, it does not cover money laundering. Government amendment 151, which introduced a failure to prevent fraud offence, was amended in the other place to remove the planned exemption for all organisations that do not qualify as “'large organisations”. If it is left as it is, the introduction of a “failure to prevent fraud” offence will apply to just 0.5% of all businesses in the UK. As Lord Gamier pointed out so aptly in the other place, with 99.5% of businesses being exempt, that would be the equivalent of only prosecuting murderers over the height of 6 feet 6 inches.

Richard Fuller: The hon. Lady is making some excellent points on her side of the argument, but I think that the 0.5% figure misses the fact that that probably covers a substantially larger proportion of economic activity in the country.
What intrigues me is this. There is a balance to be struck here. I think the hon. Lady will go on to ask the Government not to press their amendment, or to else to oppose Lords amendment 159; but what, in practice, will this mean for smaller businesses if they are to be held to the responsibility to prevent fraud? Is it a certificate on the wall? Is it an annual process that they will need to go through? How much is it going to cost? Ultimately, who will give a guarantee to all the small business owners around the country who are worried about this new responsibility? How will they know that they have taken the actions under prevention procedures to ensure that they will not be subject to legal prosecution?

Seema Malhotra: I think that that will be covered in the points I am going to make, including around the steps that the Government need to take further.

Margaret Hodge: On that point, there is discussion in the Bill about reasonable arrangements, which will be decided through secondary legislation. It will be necessary to ensure that the processes through which small and medium-sized enterprises show that they are preventing fraud and money laundering can be done in a way that is not burdensome on those businesses or a detriment to them. The same arguments took place over the bribery legislation, when there was concern about an attempt to have an SME exemption. That failed at that point, and all the research since that legislation was enacted shows there has been no detriment to SMEs or to their ability to export.

Seema Malhotra: I thank my right hon. Friend for her intervention. Indeed, she pre-empts some of the content of my speech, which is absolutely fine—we can reference it twice. She makes an important point about the Bribery Act 2010, which has also been referred to by the right hon. and learned Member for South Swindon.
The important point here is that it is for the Government to get this right, and I think we can all agree that there should not be disproportionate costs for small businesses. Lord Vaux, an experienced professional in these areas, also expressed concern over the credibility of the Government’s figures on the estimated costs for smaller businesses. Another important argument is that these policies can also protect SMEs, which are also the victims of fraud. We can sometimes lose sight of that.  In 2022, 64% of UK businesses experienced fraud, corruption or other economic crime. That is much higher than the global average of 46%, and second only to South Africa. This is a matter of a cost to businesses as much as a cost for businesses, and what the extent of that would be in reality.
We have also looked at the safeguards—particularly since my conversation with the Minister last week—that are in place to avoid disproportionate costs for SMEs, which the Government can use to get the balance right. Spotlight on Corruption has noted:
“It is open to the government to make clear in guidance issued for the offence what reasonable procedures would be proportionate for SMEs, and in what circumstances it would be reasonable not to have them at all.”
The offence also contains a defence for companies to be able to argue, in the event of legal action, that its procedures were reasonable in all the circumstances or that it was not reasonable to expect the body to have any prevention procedures in place. That is important for informing the debate today and it is the reason that, after deliberations and listening to the Minister last week, we have decided that we should support the debate in the Lords and that we do not want to see the exemption for SMEs taken out of the Bill.
Amendment 159, on failure to prevent money laundering, was tabled by the noble Lord Garnier. It would expand the scope of the Government’s new offence of failure to prevent fraud so that the offence would also cover money laundering. The Government argue that this amendment is not needed as we already have an anti-money laundering supervisory regime, but I remind the Minister that a Treasury review into our anti-money laundering regulations published in June stated that
“significant weaknesses remain in the UK’s supervision regime.”
Hugely frustratingly, the Government have responded to that with yet another consultation.
In addition, since the most recent money laundering regulations were brought in, the UK has had only one corporate criminal conviction for money laundering, so it is pretty clear that the existing safeguards against money laundering are not enough. Here is a chance to take stronger action and to include in the new offence a failure to prevent money laundering, and the Government should take it. We will be supporting this amendment to stay part of the Bill.
Lords Amendment 161 was tabled in the other place by the noble Lord Agnew. Crucially, it would extend the cost cap for civil recovery cases beyond the cap introduced for unexplained wealth orders in the Economic Crime (Transparency and Enforcement) Act 2022. Let me quote Lord Agnew:
“We have a complete mishmash on the principles of cost capping at the moment. For example, cases taken in the magistrates’ court have cost capping, as do cases taken by the SRA. However, we do not have cost capping for the most important of all: those large cases where the enforcement agencies are trying to take on big-time oligarchs.”—[Official Report, House of Lords, 27 June 2023; Vol. 831, c. 674.]
This Lords amendment would significantly aid the fight against economic crime in our country. Currently the balance is tipped in favour of the criminals and the kleptocrats and away from the prosecutors and their agencies who want to pursue these cases but cannot  afford to do so. It is also strongly supported by Bill Browder. The reality is that far too often the other side can afford any cost to support their case.
The Government have tabled a motion to disagree with Lords amendment 161 and have offered a counter-amendment (a), which would oblige the Secretary of State to report on potential policies to extend cost caps, but this is a serious issue to address now. I see no reasonable explanation as to why the Government would continue to oppose the inclusion of this amendment in the Bill and the strong backing it would give to the enforcement agencies, which we would expect to act with a strong threshold of evidence in order to bring any cases—a point that I hope will address any other concerns the Minister has.
To conclude, this Bill is welcome but long overdue, and loopholes remain. Labour has laid out our arguments in support of the Lords amendments. They have been passed with cross-party support and in good faith, and they will clearly make the Bill stronger. The Government must seize the opportunity of this Bill to drive forward the transparency that we need and to help our law enforcement bodies to act. These are the choices the Government must make, and I urge them to reconsider the much-needed amendments from the other place today.

Nigel Evans: This business is protected for up to three hours and I am expecting multiple votes at the end of the debate, which could go on until 9.50 pm. The votes would not eat into the next business, which could go on for two hours. I hope that Members will therefore reflect on whether their speeches could be briefer than they had perhaps anticipated, as that would be helpful to everyone concerned, including the staff of the House.

Mary Robinson: It is a pleasure to rise in support of Lords amendments 146 and 147, which introduce the power to strike out SLAPPs claims in relation to instances of economic crime. SLAPPs—strategic litigation against public participation claims—are described as
“legal actions typically brought…with the intention of harassing, intimidating and financially or psychologically exhausting opponents via improper use of the legal system.”
In essence, people who have such a claim brought against them are threatened into silence. They are a tool of intimidation and censorship, often used by wealthy individuals such as Russian oligarchs or by corporations against individuals such as journalists who rarely have the financial means to fight back.
SLAPPs are not brought with the intention of participants having their day in court; they are based on the power of inequality of arms and are intended to stifle free speech, with the allegations never seeing the light of day. For the purposes of this Bill, SLAPPs claims are defined as one where the claimant’s behaviour in relation to the matters concerned has or intends to have the effect of restraining the defendant’s freedom of speech, and that any disclosures they seek to restrain have to do with economic crime or would be made in the public interest to fight economic crime.
These amendments seek to give people more protection when facing a SLAPP claim in relation to economic crime only. They will be able to use a new early dismissal mechanism and, where a case does proceed, they will  have the umbrella of a new cost protection regime. This matters because costs can be prohibitive when fighting legal cases, and indeed the financial risks are intended to deter people from fighting back. However, we cannot let people who seek to silence and intimidate win.
We should be concerned that, in 2022, the Coalition Against SLAPPs in Europe found that the UK was the top European destination for cross-border litigation, with 15 of 62 known transnational cases over a decade being filed here. Who knows, there may be more. One of the reasons we are in this position is that the UK has no anti-SLAPP legislation, and I therefore welcome the measures that are being introduced here.
Although the Bill concentrates on economic crime only, I encourage Ministers to make it the first step in bringing a stop to SLAPPs altogether. SLAPPs are not just a threat to freedom of speech and freedom of expression, they seek to stop so many other disclosures that are in the public interest.
As chair of the all-party parliamentary group for whistleblowing, I am committed to protecting and empowering people who speak out. I have been pushing for legislative change to ensure that people feel able, safe and supported to make disclosures that are in the public interest. Whistleblowers, as my hon. Friend the Minister knows, are pivotal in the fight against economic crime and fraud, with almost half of all fraud detected by whistleblowers. Because economic crime is often well hidden and difficult to trace, discovering it requires insiders to speak out and share their knowledge.
Take, for example, the £178 billion Danske Bank money laundering scheme, which was exposed only as a result of a whistleblower who had worked in the bank’s trading unit and who raised concerns about breaches of anti-money laundering procedures in its Estonian branch. His internal reports ignored, he turned to the US Securities and Exchange Commission. Once allegations made the news headlines, Danske Bank itself ordered an investigation that confirmed the whistleblower’s claims.
Although a worker may seek protection at an employment tribunal, journalists, who are often the target of SLAPPs, are not recognised as whistleblowers under UK law, and they are therefore afforded no protection. Yet due to the investigative nature of their work, they are among the most likely to acquire inside information and evidence of wrongdoing. At the moment our whistleblowing legislation, the Public Interest Disclosure Act 1998, applies only to workers and is meant to protect them from unfair dismissal or detriment at work that may result from their whistleblowing. Whistleblowers such as journalists, who fall outside our current laws and are prey to SLAPPs, will find support with these amendments where their disclosure relates to economic crime.

Chris Bryant: I completely agree with everything the hon. Lady has said about SLAPPs and the importance of journalists effectively acting as an additional regulator, but they need the information. Does she also support the amendments that would ensure trusts cannot be a means of hiding information from journalists and others who might want to be able to reveal it?

Mary Robinson: I am grateful to the hon. Gentleman for bringing that point forward. As we know, this is about investigative journalists who want to get in there and get the information. Transparency is in the name of the Bill, which may answer his question.

Chris Bryant: The Government are insisting that we should keep the real ownership of trusts secret, and the problem journalists have is that there is not a proper exemption to enable them to find out the ownership that lies behind a trust.

Mary Robinson: I am grateful to the hon. Gentleman for that clarification. The important thing is that journalists do not find themselves called before the courts through SLAPPs and this type of litigation, and that is the point we are trying to make here. I am sure the Minister has heard the hon. Gentleman.
As has been said, SLAPPs are used to silence and cover up. To effectively root out economic crime, it is right that we address their use, but I think the Government can go further still by reforming the UK’s whistleblowing laws. In doing so, we could encourage more people to come forward with evidence of economic crime, secure in the knowledge that the system is on their side. We must have a system that recognises any person as a potential whistleblower, not just an employee, as our current legislation does. We must have a system that values whistleblowers, not one that ignores or punishes them. We must have a system that makes whistleblowers feel supported and valued.
I know the Government are currently reviewing the UK’s whistleblowing framework, and I will continue to push for the reform we need. Meanwhile, these amendments are an important step forward, and I am pleased to support them.

Alison Thewliss: I welcome the moves the Government have made on this Bill. It is important that they have done so, but they could still go much further.
I pay tribute to the work of the right hon. Member for Barking (Dame Margaret Hodge) on the all-party parliamentary group on anti-corruption and responsible tax, and to the organisations in this sector that do so much to bring light to what can be a very complex and detailed issue.
The Minister talks about the UK having a reputation for allowing legitimate businesses to thrive, but we are here this evening to challenge the other reputation that has built up over the years. The UK has now become a hub for dirty money, which is funnelled through the UK’s financial system by an army of enablers. This Bill is an opportunity to dam that flow and to stop this dirty money, but as the excellent “Catch me if you can: Gaps in the Register of Overseas Entities” report, published by the London School of Economics and CAGE Warwick, says,
“there is no point building a dam halfway across a river.”
Without closing the loopholes and the gaps, that is what this Government are doing.
The Minister has promised consultations and further things to come in the future. It is fine to dangle these things before us, but we all know that we are heading towards an election and the Government cannot promise to deliver on any of the consultations he hopes to bring forward. Whatever happens, there will be an election. This House is almost out of time, and we should take the opportunity tonight to do this Bill right.
I will run through the Lords amendments, given the time constraints you mentioned, Mr Deputy Speaker.  The Lords amendment on nominee shareholders was tabled by Lord Vaux, and as other Members have said, there is an awful lot more we could do on that. It is not enough for the Government just to say, as they did in their letter to Members, that such a measure would most likely be ignored by illegitimate actors and would be difficult to enforce. That is not much of a reason not to legislate and not to try. There is a real issue with how complex structures have been brought about, and the Government need to grab hold of it. This Bill is an opportunity to close a loophole before it is further exploited.
Enforcement is a big part of this, and the Government do not enforce the current rules. Saying a measure would be difficult to enforce when they are not enforcing the rules to begin with does not give us great confidence. Between 2012 and 2022 only three fines were issued for false filing to Companies House. As of October 2022, only one fine of £210 has been issued for not filing the person with significant control of a Scottish limited partnership. If the Government do not enforce the rules they have brought forward, they cannot really ask for more rules. They need to get real about enforcement. They need to make sure the laws we pass this evening are effective.
Updates to the register of overseas entities are a significant gap in the system. As others have said, updates can take almost an entire year, in which time other things could happen. Event-driven updates would hold companies to account. If we think about it, there will be paperwork when companies make any change, so they might as well do the update at the same time. That would be logical.
Lords amendment 117 in the name of Lord Agnew, on the transparency of trust data on the register of overseas entities, makes a critical point. We must deal with trusts without further delay, without further consultation and without kicking the can further down the road. Here is the opportunity to do that. As Transparency International and the BBC showed in February, trusts are being used to hide the ownership of thousands of overseas entities under the current regime. They estimate that more than 7,000 overseas entities on the register, about a quarter of the total, are hiding the ownership of roughly 20,000 properties. Why would the Minister not want to close that loophole? Why would he not want to improve this system right now?
It is not as though the Government were not warned on this. They are talking about consulting and doing more on it, but they were warned about this when we had the Joint Select Committee on the draft Registration of Overseas Entities Bill. In March 2019, Professor Jonathan Fisher KC said:
“If I was asked to advise, on the face of the draft legislation, the first thing I would say is, ‘Have you thought about setting up a trust?’”.
He went on to say:
“I might say to someone, ‘If you really want to do this Technicolor, why don’t you have an offshore company and have the shares of the company put in trust, and when you set that trust up, why don’t you think about setting it up as a discretionary trust?” If it is a discretionary trust, the beneficiary does not rank as a beneficiary in law; all they have in law is the right to be considered by the trustee when capital income is distributed.”
So all kinds of things were already identified and very clear to the Government, having been highlighted in  evidence, and they could have put these pieces of evidence into this Bill to make sure that we are closing the loopholes now, rather than allowing this to spiral yet further.
It is also very evident that this database needs to be accessible to the widest possible group of people, because the law enforcement, particularly under this Government, does not have the money, expertise or time to go into this in significant detail.
Let me highlight some of the scale of the issue. We owe a great debt of gratitude to Graham Barrow, as a researcher into these things, in his own time, as a Companies House geek. He says that the use of brass plaque addresses for company incorporations has increased since lockdown. He has done an analysis of two main addresses being used. In Shelton Street, between 2018 and 2022, the number of incorporations at the one brass plaque address grew by 340%, from 6,200 to 27,350. Similarly, the incorporations in Wenlock Road also grew significantly, by 40%. Those are just two addresses, and the numbers are increasingly significantly. That is due to the loopholes that the Government have allowed and the corporate structures that currently exist.
We sought further amendments to tighten this and prevent these brass plaque addresses from being used for hundreds and thousands of companies. There is certainly more the Government could be doing to ensure that trusts do not fall down on this point; allowing people to register trusts in a similar way will result in the same issues.

Kevin Hollinrake: Is the point not that in the 400 pages of legislation we have before us we are doing exactly that: closing these loopholes, making it easier for businesses and making it easier for Companies House to make sure that these entries are valid? We are also committed to increasing the fees at Companies House to make sure that the proper resources are in place for it. Indeed, we have increased the resources for enforcement at the National Crime Agency by 40% since 2019, with this now standing at just below £800 million a year.

Alison Thewliss: I thank the Minister for that point, but the number of incorporations is massive and the resource to Companies House is not keeping pace to check on each and every company that is going. I direct him to the tweet from Graham Barrow highlighting some of these issues, because there are so many companies and we need as many eyes as possible on this data. Companies House does not have the resource to do this and neither does law enforcement. Allowing those researchers who have the time, expertise and patience to tease out this data to do this and do it well is important. They must be allowed to do this.
Let me turn to the amendment on failure to prevent fraud, from Lord Garnier. I recall the Minister being keen on such an amendment beforehand and there is an awful lot more the Government could be doing on this. As other Members have said, if this can be done for bribery and tax evasion, there is no reason why doing it for fraud should present an additional burden. As the Minister himself pointed out, 99% of businesses are not in scope under what is being proposed here—again, that is ludicrous.
There is also an effect on small and medium-sized businesses to consider, because they also stand to lose  money through fraud. They stand to be targeted by those who want to commit this fraud. So those businesses that are perhaps more exposed—those local businesses that do not have the power to stand up to those who would bully them to engage in such activity—are put at risk and should be better protected by this legislation, were they to be kept in line with it.

Richard Fuller: The hon. Lady has made a point, which the shadow spokesperson also made, about harms being done to small businesses by businesses that are committing fraud against them. But there is already a law against committing fraud, so why does the additional law about not taking any actions to prevent fraud help in those circumstances?

Alison Thewliss: Because such a law has helped in the case of the Health and Safety Executive. The Minister used to talk about how when the health and safety legislation came in, the number of deaths at work dropped dramatically, because the measure was a preventive one, whereby one had to prevent people from being injured and killed at work. This works the same way for bribery and tax evasion, so why would it not also work for fraud?

Richard Fuller: rose—

Alison Thewliss: I will not give way, as I am conscious of the amount of time for this debate. As I was saying, it is important that we recognise the significance of this to small businesses—this is there to help them, not hinder them.
I move on to the cost protection for civil recovery cases. Again, this is incredibly important, because the balance we have is not right. Those who can pay—the enablers, the lawyers, the sharp accountants—have a huge advantage over law enforcement agencies, which do not have significant resource and expertise to do this. As Bill Browder said when he gave evidence to the Bill Committee in October 2022:
“What has to happen here—this is plain as day—is that you have to get rid of this adverse costs issue in a civil case brought by the Government… If you make that point, it will change the whole dynamic—the whole risk-reward—for these people.”––[Official Report, Economic Crime and Corporate Transparency Public Bill Committee, 25 October 2022; c. 66, Q140.]
On adverse costs, the Government are saying that they are sympathetic to this, and they are going to consult and do some other things later on, but by not putting this measure in this Bill, they are allowing this uneven playing field to continue and be perpetuated. Because the law enforcement agencies know that it is going to cost them an absolute fortune, which they do not have, these cases go unpunished and those who perpetrate all of this money laundering, with all this money washing through the UK financial system, will see this continue, because people can afford to get away with it. The Government should be deeply concerned about that.
Let me recommend to the Minister Bill Browder’s latest book—if he has not already read it. It exposes the capture of all of these enablers, from lawyers to everybody else; we need to be looking to close the door on that in this Bill. The Government have an important opportunity here. This important situation does not come along very often and we do not know when we will pass this  way again. We have a Bill in front of us. The Government could go for accuracy and for transparency in the register. They could close the door, fix the loopholes and do all of these things that they must do. They could accept these Lords amendments tonight. They could fix this Bill and do it right, and we would not have to come back here to legislate again.

Robert Buckland: It is a pleasure to follow the hon. Member for Glasgow Central (Alison Thewliss). She said that we might not pass this way again. Indeed, this has been a very long way for me and for many others in this House who have been making the case for a failure to prevent offence for many years, both in office and as Back Benchers. I am delighted that the Under-Secretary of State for Business and Trade, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) is in his place, because he is a true believer as well.
I hoped that tonight could have been a Simeon moment—I could have sung my Nunc Dimittis and departed in peace—but no, I am afraid that, as a result of the welcome but somewhat limited amendments made by the Government in the Lords, I am reduced to the role of Moses; I can see the promised land but I am not, it seems, according to the Government, destined to get there. Therefore my exhortation to my good friend the Minister is, “You can be Joshua. You can knock the walls of Jericho down. You can go the extra mile and finish the job.”
We have heard a lot about this failure to prevent offence, and the word “fraud” has been bandied about as if we were dealing with fraud in general. May I, perhaps uncharacteristically for some hon. Members, draw the attention of the House to the Lords amendments themselves, because they are what we are considering?
I, like you, Madam Deputy Speaker, am a stickler for ensuring that we stick to the point, so I turn to page 46 of the bundle and, in particular, amendment 151, which is the proposed new clause “Failure to prevent fraud”. It ain’t any old fraud; it is fraud intending to benefit “the relevant body”. That is not a fraud in general, about loss to the taxpayer or the company—in fact, there is a specific defence on that basis that says if the fraud causes loss to the company, it is not a criminal offence—but a very targeted type of fraud that is about benefit to the company.
As a lawyer, Madam Deputy Speaker, you know that we have something called the criminal standard of proof. This is not any old regulatory device; this is a criminal offence. The threshold and standards that have to be applied by the police, the investigating authorities and the prosecutors are high. As my right hon. and learned Friend the Member for Kenilworth and Southam (Sir Jeremy Wright) said, the defence set out in clause 4, about reasonable prevention proceedings, is crucial. When I hear people talk about regulatory burden, I have to say, in all candour, that that is a misplaced understanding of what this rather limited offence will achieve.

Richard Fuller: rose—

Robert Buckland: I will give way to my hon. Friend and then explain why he is wrong.

Richard Fuller: I thank my right hon. and learned Friend. He seems to have some mixed views on the  point of regulatory burden, particularly on this measure. He makes the point about fraud being a crime, but this legislation is about actions to prevent fraud, as he knows. What do I tell the good, upstanding owners and managers of small businesses in my constituency that they are doing wrong about fraud today? How are they letting him down because they are not taking the actions to prevent fraud that he thinks they should be taking?

Robert Buckland: Tell them that this offence is about fraud intended to benefit themselves, not about a fraud that causes them loss. This is a limited offence. It is the misunderstanding of the term “fraud” in the clause that is so important to the debate; we have to focus, laser-like, on that.
My hon. Friend the Member for North East Bedfordshire (Richard Fuller) is well experienced in business, over many years in financial services, and I bow to the expertise and experience that he has brought to the House, and indeed to ministerial office—all too briefly, which was a shame. He will understand the law of corporate liability in the United States—a vigorous free market economy, the biggest economy in the world, where people go to invest and grow businesses. I can tell him that corporate criminal liability in the United States is pretty draconian, because companies there are liable, even if their employees go off on a frolic of their own and defraud to their hearts’ content, yet corporate criminal liability there will bite upon United States entities. That is far more draconian that anything we have in this jurisdiction and far more onerous, potentially, when it comes to regulatory burden, yet my hon. Friend cannot argue with me that the United States is anything other than a vigorous free market economy.

Richard Fuller: I do not want to argue about that point, but the United States is also an incredibly litigious society. The main beneficiaries of much of this are the legal community, with which my right hon. and learned Friend will be particularly familiar. As a result of the clause applying to smaller businesses in my constituency, can he tell me specifically what they will need to do differently that they do not do today?

Robert Buckland: They will have in place reasonable procedures to prevent people from acting on their behalf and unjustly benefiting their own companies and entities. Let us not forget it is a partnership offence as well. I do not see that as some sort of general exhortation to small and medium-sized businesses to suddenly put in place measures to prevent fraud in general—that is not what the offence says.

Jeremy Wright: Does my right hon. and learned Friend agree that part of the answer to the point made by our hon. Friend the Member for North East Bedfordshire (Richard Fuller) is that the vast majority of businesses will not need to do anything differently, because what they do now is perfectly reasonable. If what they are doing is reasonable, they will be perfectly safe from this legislation. This legislation is intended to catch those who do not behave reasonably and those who behave dishonestly, which will be a tiny minority. We accept that the legislation will not lead to a huge number of prosecutions or convictions; it is supposed to lead to a change in behaviour where that is needed.

Robert Buckland: Exactly, and that is the point. What the Government have done is set up a legislative Aunt Sally. I welcome their putting in place mitigating measures to deal with parent companies and subsidiaries—Lord Bellamy explained that very well indeed—but the threshold they have set is entirely unnecessary. It does not reflect what the Law Commission said in its report. When I was in office, I was delighted to ask the Law Commission to do the work on failure to prevent fraud. It did the work and, hey presto, it produced proposals that had nothing about thresholds in them, so where on earth has that come from?
I am sorry if I might have inadvertently upset my hon. Friend the Minister by mentioning His Majesty’s Treasury, but I detect the hand of my friends in Parliament Street. I know their view about failure to prevent fraud; they do not like the offence and never have done. They have always put up arguments against it. Perhaps it is their role to do that—I do not know—but I detect their hand in this. That is an unfortunate coda to what would have been a magnificent symphony, had my hon. Friend the Minister stuck to the line and done what I thought he was going to do.
To return to the point made by my hon. Friend the Member for North East Bedfordshire, I agree that the United States is a litigious society. We, in the United Kingdom, do not necessarily want to go down that road when it comes to civil litigation, but what the United States does well is prosecution of fraud. It regularly and rigorously enforces the criminal law of fraud, particularly in the jurisdiction of New York and in other major financial centres, which enhances the reputation of that jurisdiction as a safe place to do business.
Here is the argument that you, Mr Deputy Speaker, do not hear, in contradistinction to the argument about the regulatory burden. Where there is a criminal legal framework that is clear, certain and stable, that can only encourage investment into the United Kingdom, not discourage it. A jurisdiction with a robust and independent judiciary and a fine legal tradition, which rigorously polices the law of corporate criminal liability, is one that investors can have the greatest confidence about investing in. What on earth is happening here to undermine that very powerful argument?
Prosecutors, including the Crown Prosecution Service and the Serious Fraud Office, have made the case consistently that a “failure to prevent” offence of this nature would help them in the important work they do in bringing wrongdoers to book. We do not want to be a jurisdiction where it is too easy to commit fraud that benefits corporates. We do not want to be that sort of place—that is not a healthy place within which we should be operating. If we are truly committed to a vigorous free market economy, then, in the traditions of Adam Smith, we should be absolutely committed to its policing and its boundaries. I sound a bit evangelical about this—a bit biblical, a bit Old Testament—because it is important that we get this right at this last stage of the Bill.
That brings me to my noble Friend Lord Garnier’s amendment about money laundering. He made the argument very well and, having read his entry in Lords Hansard, I will adopt it. I am in danger of sounding like a broken record, but I make no apology for that. Money laundering is already a criminal offence. The regulatory argument does not cover the full gamut of what we are  dealing with, and Lord Garnier’s amendment is a sensible reflection of the importance of ensuring we cover offences of money laundering. Remember again that this is about benefiting the company; it is not money laundering in general, but a targeted offence, with the same caveats and qualifications that I mentioned in the context of the “failing to prevent fraud” offence. So I say to my hon. Friend, “Repent!”. He should follow the true path and come back and finish the job. We can all then take equal pride in the work that he and others have done to make sure that this jurisdiction is a fairer and better place in which to do business.
Let me end on this note. I will not dwell too much on the rather milquetoast amendment about the capping of cost orders for proceedings for civil recovery. We know that it is a problem. We know that it is a disincentive to the bringing of civil proceedings under the Proceeds of Crime Act 2002. We should just get on with it. The particular rules and proposals about costs are well reflected in other parts of legal procedure and other types of proceedings, so this is nothing new. I think that it is time that we grasped the nettle rather than having yet another report.
Finally, Lord Agnew made a very powerful point: just a few words is all it takes to make a difference when it comes to trusts and the arguments that have been very cogently made about that by others. Only a few small steps need to be taken by my hon. Friend and His Majesty’s Government to allow us to reach that promised land. I urge him to take us there and then we can all celebrate in a land of milk and honey.

Margaret Hodge: I shall start where that brilliant speech by the right hon. and learned Member for South Swindon (Sir Robert Buckland) ended. I would also say to the Minister, and also to the Minister for Security, the right hon. Member for Tonbridge and Malling (Tom Tugendhat) were he still in his place, that they have shown from their time as Back Benchers a real understanding of all the issues around economic crime. They knew what needed to be done. They helped to develop the agenda that would work through smart regulation, transparency, tough enforcement and proper accountability. When the Bill arrived in the House, it was, I hope the Minister will agree, a bit half-baked. I am not blaming the civil servants in the box, but it was a bit half-baked. It was full of loopholes and serious omissions. But in this year that we have been considering the legislation, it has gone through tremendous transformations, so I salute the Minister for what he has done, but urge him to go that step further. I thank the Labour Front-Bench team for their assiduous and detailed work on this, but I particularly salute the Back Benchers—Back Benchers from all parts of this House who have joined together to bring forward a set of pragmatic, practical amendments that really will make this Bill fit for purpose. I also thank those in the House of Lords who have worked across parties, with the Cross Benchers, to ensure that we have some serious amendments that will give us a good framework to start the eradication of the malignant infection that we have with dirty money.
I say to the Minister: do not undo that good work; do not emasculate what has happened and where we have got to; and do not give into the voices of enablers who want to make a fortune on the back of dirty money. I wonder, as the right hon. and learned Member for  South Swindon has wondered, why on earth is the Minister not listening to what we are saying. Everybody in Parliament wants this. Everybody in the country wants this. Nobody supports dirty money. As I have said time and again, the country will not sustain economic prosperity and wealth on the back of dirty money. There is no future in that. I give the Minister another commitment, which I really regret having to say. I will not be here, but I want a future Labour Government to commit to never having a system that allows any political party to exist on the back of donations of dirty money. I say: do not let this opportunity go. Do not betray the principles and do not cave into the lobbying. The Government should look at the excellent amendments and please go forward.
I wish to focus on some new points. Lord Agnew’s excellent amendment in relation to trusts needs to be considered. The Minister said that he did not accept the research that was published today by really respected academics. These are people I have worked with over the years in whose work I have total and utter confidence. I challenge the Minister to bring them in and talk to them and then see if he comes to the view that what they are saying is not true. What they are saying is that we do not know the beneficial owner of 70% of the properties identified as owned by an overseas entity. And we do not know the beneficial owner of two thirds of that 70% because there is a trust that hides the real beneficial ownership. The Minister should have regard to what they say, as they are distinguished. I urge him to talk to them. I am happy to join in a meeting with them. In 87% of cases where information is either missing or inaccessible, it is because of Government choices in the design of the scheme. It is not because people are not obeying the law. It is because the Government have chosen to design the scheme in that way.

Kevin Hollinrake: rose—

Margaret Hodge: I am conscious of time, but I will give way to the Minister.

Kevin Hollinrake: When the LSE looked at beneficial ownership, I think that it included tenants of properties rather than the ownership of properties, and the register of overseas entities only deals with the ownership of those properties. There is definitely some disconnect between the Government’s position on this and the legislation and the interpretation that has been taken with this research from LSE.

Margaret Hodge: I have met the key academics involved in this on a number of occasions, and I urge the Minister to do so as well. I think the differences are between the entities and the properties. We started asking for a register of properties that were owned by overseas entities in 2012, 2014 and 2016. It was absolutely ages ago. It was when David Cameron was Prime Minister. It was finally enacted last year, but it has been enacted badly. I have to say that it is the secrecy that matters. We can have transparency and we can protect vulnerable people. Transparency will enable all eyes—many, many more eyes—to interrogate the data and the Minister knows that to be true.
Let me put in this basic point. He and I own properties. We are not ashamed of showing the ownership of those properties. Why should we reveal the ownership of the properties in which we live, when rich people—often  kleptocrats, often criminals, often money launderers—are able to use trusts as a mechanism to hide their ownership? That is a basic unfairness that the Minister should deal with. May I quote to him the words of one of the firms of lawyers that is exploiting the loophole? It is Payne Hicks Beach—Baroness Fiona Shackleton is a member of that firm. The firm says:
“On the face of it, the lacuna would seem to defeat the purpose of the legislation”—
this is lawyers saying this—
“so may be tightened up”—
hopefully tonight—
“in the future, but for the time being, using a nominee to hold UK property will continue to provide privacy as far as the ROE is concerned.”
Lawyers are exploiting that loophole, and we should stop it because—I hope that the Minster will agree with this—it is damaging our sanctions policy. Usmanov has been able to hide a lot of his wealth in property through trusts. Abramovich has done it, Fedotov has done it, and it is time that we brought it to a stop.
The other key issue is the failure to prevent. I will quote to the Minister what he said time and again. This is not about additional burdens on SMEs, or filling the courts with criminal cases; this is about trying to change the behaviour in our society, so that preventing fraud and money laundering becomes embedded in our culture, in the same way that preventing bribery has become embedded in business culture. The example that the Minister used when he was on the Back Benches is very potent. When we used to have a lot of accidents and deaths on construction sites, we reformed the health and safety at work legislation. We did not suddenly fill the courts with builders and construction people being taken to court, but overnight the number of accidents went down by over 90%. That is the principle that we are working on. That is the evidence that we want to use, and it is vital that we do it here.
The failure to prevent clause, so ably moved and worked upon by Government Members, is the key clause that would really be the game-changer on the whole issue of dirty money. If we can only get that clause as agreed in the House of Lords through, we would really see a difference in what is happening. Taking out the provisions on SMEs and on money laundering is ridiculous. The Minister knows that it is absurd. There has been one prosecution on money laundering. When the Financial Action Task Force came here in 2018, it said that it was looking at 180 high-end money laundering investigations. Out of that we have had one case, so do not tell us that things are currently working.
I want to keep to time, but quickly on cost caps, crooks have such deep pockets. We saw that with the unexplained wealth orders. It is outrageous that the people who managed to win the case in the courts—although investigative journalists have subsequently suggested that they lied to the courts, in effect; that the evidence that they gave was not the truth—have claimed £1.5 million in costs from the National Crime Agency. The NCA’s total budget for fighting corruption is £4 million a year. If it loses £1.5 million on one case alone, the idea that it will have any confidence in litigating when it comes across cases of bad actors and malpractice is for  the birds. If we do not tackle the cost-capping issue, we will never get on top of the really bad people whom we want to eliminate from our economy.
This is one area where we just have to look at the Americans and the way that they pursue money launderers and fraud much more aggressively. The money that they bring back into the public coffers, which can then be spent on public services, is enormous. In 2021, we managed to extract £354 million in fines; the Americans took £1.2 billion-worth of fines—$1.5 billion-worth. Our £354 million is 0.3% of the amount that was laundered there. Bill Browder, who has been a real advocate in this area, believes that this is another amendment that would change things.
On nominees, this is such a simple amendment. I cannot understand the resistance to it. All it does is give us more information and enable us more readily to know who are the genuine owners of particular companies. Allowing individuals to hide behind nominees is absurd. Those are the things that really matter to me and that could make the difference and turn a Bill that is much better than it was but is still not perfect into a very powerful instrument that would allow us to go out and turn around very effectively the malignant disease that has infected the UK economy of massive money laundering, fraud and economic crime. I urge the Minister, “Be bold! You’ve got a year left to do it. Be bold in that year.”

Nigel Evans: Thank you for the way that you conducted your speech. I saw what you were doing, and thank you very much for helping.

Robert Buckland: On a point of order, Mr Deputy Speaker, I seek your guidance on how I can put on the record that I refer hon. Members to my entry in the Register of Members’ Financial Interests.

Nigel Evans: I think you have already done it—thank you very much.

Richard Fuller: The Economic Crime and Corporate Transparency Bill is an important Bill that has cross-party support. I do not know whether it is appropriate to say that the right hon. Member for Barking (Dame Margaret Hodge) is in many ways its godmother, but she is certainly one of the key drivers of this important legislation. Whether it is perfect in her regard or nearly perfect in her regard, I would like to put on record that for all of us her efforts have been to the benefit of the country as a whole.
It is with some temerity that I wish to make a few points perhaps not in accordance with some of the comments made particularly by my right hon. and learned Friends the Members for Kenilworth and Southam (Sir Jeremy Wright) and for South Swindon (Sir Robert Buckland), who make the case for extending the failure to prevent fraud provisions to smaller businesses. I must say that they have not convinced me of the merits of their argument at this stage, and I think on balance I am with the Minister on this.
I am a Conservative and therefore change is perhaps always difficult for me, but I think particularly of what the implications may be for smaller businesses. I have not been persuaded by the other examples put forward of health and safety or bribery; I think there will be quite a chilling effect if the responsibilities for preventing  fraud are extended to small business owners. I think it is appropriate and prudent that we build the measures, as the Minister has said, in his amendment (a) to Lords amendment 151. That is all I will say on Lords amendment 151,
However, I want to talk about another amendment that affects small businesses, which no other hon. Member has referred to in this debate: Lords amendment 30 regarding the disclosure of profit and loss accounts for certain companies, which the Bill will require of small businesses and microbusinesses that had previously been exempt. It potentially causes considerable concerns for owners of very small businesses if they are to have their profit and loss and their balance sheets publicly declared through Companies House reporting.
I ask hon. Members to imagine, if they will, that in a town or a community there are two or three competing laundries or plumbers, all of them maybe husband and wife, father and son or whatever—concentrating on what I want to say of a small business—or just sole proprietors, competing with each other in a small market. If their profit and loss statements were to be a matter of public knowledge, that would have very serious implications for local understanding of that person’s or that family’s personal wealth. It would have significant implications for local competition. The provisions that were in place in the Bill originally provided no protection for people in those circumstances. Yes, they will still provide the information, but surely it makes sense for companies in those circumstances not to have all their very specific financial information in the public domain.
I believe Lords amendment 30—the Minister might refer to this if he has time—seeks to provide a mechanism for a restriction on that disclosure of such personal information. The amendment lays out in proposed new subsections 468A(1) and (2) of the Companies Act 2006 that the Secretary of State
“may by regulations make provision requiring the registrar, on application or otherwise”,
and goes on further to say that regulations
“which provide for the making of an application may make provision”
as to who may make an application, the grounds on which an application can be made, the information to be included in it, the notice to be given, how an application is to be done and so on. My concern here is that Lords amendment 30, in seeking to correct the over-disclosure of public information, has put in its place quite a complicated application procedure.
Therefore, it would be helpful if the Minister could say what he has or what the Government have in mind about that application process. It would be ideal if that process were just a tick box. It would be ideal if that information could be communicated to accountants across this country who regularly have to file accounts on behalf of very small businesses, and it would be helpful if the Minister could advise that it is the Government’s intent that very small businesses in the circumstances I have outlined will not have very private personal financial information put in the public domain, although their information will still be required by Companies House and therefore placed under the protection that the Bill seeks to address.

Liam Byrne: I rise to endorse 100% the brilliant speech by my right hon. Friend the Member for Barking (Dame Margaret Hodge). Let me take this moment to  pay tribute to her stalwart leadership of this agenda over a long time. Our country is a better and fairer place thanks to her extraordinary work.
The Minister is not too bad, either. I think that he has done a Herculean job over quite a long time, and he has sought to do the right thing with the Bill. Crucially, he took the time to reach out and listen to members of the Committee and Members across the House to ensure that we were up to speed with where he was going and what he was trying to achieve. The result is a better piece of legislation. However, it is not yet perfect, and we are here tonight to encourage him, having gone so far, just to go those final few yards and give us a Bill that will truly be a legacy to his work here in Parliament.
Mine is a starting point that we have not yet talked about in this debate: the terrible state of wealth inequality in this country. It is so bad because economic crime is so bad. Since 2010, the wealth of the top 1% in this country has multiplied by 31 times that of the rest of us. That is, in part, because of the problem of economic crime. It is a problem that our country is a global capital of money laundering and fraud reckoned to be worth some £350 billion a year—that is a mark of national shame. It is a problem that we potentially allow the ownership of more than 100,000 of our most prestigious and expensive properties by names we just do not know. It is a problem that, last year alone, nearly £7 billion of property was bought with what Transparency International calls “suspicious wealth”.
What unites us all in this debate—indeed, what unites us all in this House—is that we know that, if we want to be a country of free trade, we have to be a country of fair trade. But if we are to be a country of fair trade, we need to be a country of clean trade, and that is why the Bill, and getting it right, is so important. When we leave holes, gaps and spaces in our defences, dirty money floods through and pollutes both our economy and our democracy. We have already passed an Elections Act that did not put in place tough enough safeguards on the kind of money that could be used to elect people to this House. We risked an Elections Act too weak to protect our democracy from dirty money, and tonight we risk compounding the error by failing to ensure that we have an Economic Crime and Corporate Transparency Bill strong, tough and robust enough to stop our economy being polluted by dirty money.
The Bill is welcome, and the Minister has done a good job. He has taken forward many of the ideas that have been discussed for a long time on all sides of the House. I am particularly grateful to him for the way in which he has used the Bill, in the SLAPP clauses, to put in place protections for truth-tellers. We know that it is not yet job done and that there is further to go, but free speech will be freer because of the provisions in the Bill. We need now to work together to finish a job that is almost complete; we need to ensure that, for once and for all, we end the ludicrous secrecy around trusts; we need to strengthen the declarations of nominees so that we truly know who owns what; we need to ensure that failure to prevent fraud is something that bites on 100% of companies and does not provide carte blanche for 99% of companies to behave without that obligation; and we need to defend our law enforcers and equip them with the tools that they need to police the legislation that we plan on passing tonight and in the days and weeks to come.
I will underline three points very quickly, Mr Deputy Speaker. The first is about secrecy. The London School of Economics report from Andy Summers, Arun Advani and their colleagues is compelling reading, and I am interested in the Minister’s take on it. The report states that we are missing information about more than 70% of the 152,000 properties that are owned by trusts standing behind overseas entities, which means that
“even law enforcement agencies do not know the true identities of the beneficial owners.”
That is of real concern, especially when we know how many billions in wealth are owned in this country by people who are bad actors and who made their money by, frankly, stealing it from people abroad. If we have learned anything from tackling economic crime, passing tougher sanctions legislation and voting for new budgets for our law enforcers, we surely have to recognise the reality that we cannot have a situation where we do not know who owns what.
My right hon. Friend the Member for Barking was absolutely right to ask how it can be right that there is one law for the citizens of this country—they have to declare who owns what—yet the same obligation does not bite on the rich, who often live abroad. We in this country do not believe that there is one law for the rich and another law for everybody else, so I ask the Minister again to think seriously about acting to fix these secrecy provisions. When Transparency International and the BBC, of all people, are saying that trusts are used to hide the ownership of 7,000 overseas entities controlling 20,000 properties, we know that we have a problem. When we remember the case study of Mr Usmanov, who used those secrecy provisions to hide £170 million, we are forewarned that secrecy brings a risk of sanction busting. That is something we in this House cannot permit.
We know that the law enforcement budgets are tiny. Many of us have heard from the senior leadership of the National Crime Agency, who have come to tell us that they have to think about what harms they police. When they are trying to deal with drugs, illegal immigration and human trafficking, the truth is that, very often, they do not have the budget they need to get to the bottom of economic crime. That is why we need to harness civil society, the media and the campaigners, and the fastest and surest way of doing so is making sure that we strip away those secrecy provisions. We must make sure that finding and tackling economic crime—hunting it down—is something that all of us are able to engage in.
The point about nominee declarations was made brilliantly by my right hon. Friend the Member for Barking, so I do not need to repeat the argument. All we would say to the Minister is that, when it comes to tackling economic crime, it is sometimes not a bad idea to have belt and braces. We understand the regime of persons of significant control that he has included in the Bill, and we welcome that, but why not gold-plate it? Why not make sure that it is copper-bottomed and absolutely as strong as possible?
My final point is about failure to prevent. As I have said, I know what it is like to grow a business of two people with a business plan on the table into a multimillion-pound business. Business in this country is stronger when it is cleaner, and competition is healthier when we  are competing on a level playing field where companies are not able to defraud others. As was brilliantly said by the right hon. and learned Member for South Swindon (Sir Robert Buckland), given that many provisions already bite on 100% of businesses, such as failure to prevent corruption, why not apply the provision of failure to prevent fraud to all businesses, too? Why are we saying to our business community that they only need to be half virtuous? Frankly, that is a recipe for disaster. I am seriously worried that we will have a situation whereby people will set up companies with a turnover of below £36 million in order to create bank accounts through which bad money is broken up into little chunks and laundered in bad ways, and I think there should be an obligation on company directors to act to prevent fraud and, indeed, money laundering. I think our economy would be healthier for that.
The Bill is tremendous progress. It is the work of many people in this House, and we should be grateful for that, but we say to the Minister, why leave this Bill imperfect? He has it within his grasp to get a Bill that will be cheered from this House. He should seize that opportunity with both hands tonight.

Nigel Evans: Again, thank you for your brevity, Liam Byrne.

Marie Rimmer: I would like to pay my respects to my hon. Friend the Member for Feltham and Heston (Seema Malhotra) for her excellent opening on our behalf, as well as to my right hon. Friend the Member for Barking (Dame Margaret Hodge) for her excellent knowledge and understanding. The time she has put in is just unbelievable. She spoke about Bill Browder—no one can read his work without realising just how serious this issue is. I also thank my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne), who covered it so aptly and brought it down to how dangerous and very serious this is for our democracy and our economic equality. What could happen, and what I think will happen, is frightening.
I want to focus on the importance of legislating on the failure to prevent fraud and money laundering, which are crimes committed in the shadows. Currently, there is a severe lack of provisions to prevent economic crime, which we know is the best, cheapest and most effective way to tackle our dirty money problem. These crimes are committed and witnessed by some of the most senior professionals at a company, and even if they are not participating but just happen to witness fraud, surely they must be under a legal duty to report it. Amendment 159 was introduced in the other place, and I pay my respects to the other place for its absolutely wonderful scrutiny of the Bill. I commend it to the Minister. He has spearheaded the Bill to where it is now, but he just needs to go that bit further.
We must have reasonable prevention mechanisms in place. The failure to prevent measures would work on multiple fronts. First and foremost, they would act as a deterrent, forcing companies to act and to take economic crime seriously if they know they would be held liable. Deterrence is proven to work. As a health and safety professional, I know that regulations to make companies and directors liable made tremendous inroads on health and safety. We may wonder why there were always so many disputes on construction sites, but it was because  there was no health and safety. The workers had to fight for everything, and they could not do it without legislation. That is why we are here: to tackle things when they are not being tackled, and economic crime is not being tackled at the present time. That legislation resulted in a 90% drop in deaths and serious injuries on construction sites, which could have involved just building a few houses.
Secondly, regulatory factors such as the fines that exist are not sufficient to bring about the required change. After all, the fines could be a lot less than these companies are earning from economic crime, and they become a cost factored into doing business for those companies. This cannot be right, and it simply cannot continue. To our shame, Britain is the global hotbed of economic crime, at a cost of £350 billion a year. The people of Ukraine are feeling the impact of this unchecked economic crime, as some of the main benefactors have been Russian oligarchs, the Russian state and Putin himself. There are the Magnitsky sanctions, but it tells us a lot, does it not, when Putin kills his own people as a deterrent? When we look at the invasion of Ukraine, we cannot sit back and let this continue unchecked.
The Government amendments to cover this do not go far enough. Well-organised criminal entities would easily get around legislation that only touches the largest companies and the largest businesses. They take advantage of small and medium-sized businesses, as my right hon. Friend the Member for Birmingham, Hodge Hill said. That is exactly what they do—they do whatever it takes. They are cleverer than us, and they are doing it now. Well-organised criminals will get around it. As 64% of companies have experienced fraud, this would help those companies.
The Government legislation fails to make failure to prevent money laundering an offence. The justification for doing that is the money laundering regulations, yet there has been only one corporate conviction since they were introduced—that of NatWest in 2021. Clearly, the money laundering regulations are not good enough. The new legislation would make companies prove that they have the right procedures in place to prevent money laundering. This is the type of tough legislation we need to crack down on economic crime. For too long Britain has been the laundromat for foreign despots and dictators.
I heard a Member across the Floor talking about feeling the chill; what is more chilling than seeing what is going on and turning a blind eye, not washing the blood off our hands for the crimes against humanity committed for the very money being laundered around our country? I urge the Minister—I know where his heart is—not to throw away this wonderful opportunity to save so much. Democracy is at risk. It really is not acceptable. Please be brave enough—be brave enough and you will sleep at night.

Kevin Hollinrake: I thank all Members for their contributions. I will not reiterate all the points I made in my opening speech, which addressed many of the points raised in the debate but shall talk to a few of the points made.
My right hon. and learned Friend the Member for Kenilworth and Southam (Sir Jeremy Wright) made some points that were also reflected by my right hon. and learned Friend the Member for South Swindon (Sir Robert  Buckland). My right hon. and learned Friend the Member for Kenilworth and Southam challenged me to explain why subsection (4)(a) of the proposed new clause in Lords amendment 151 does not prevent excessive burdens on SMEs. That measure says we must have in place “such prevention procedures” and there is a concern that many millions of SMEs across the country would have to put in place prevention procedures despite there probably being no chance of any fraud at that organisation. So there would be burdens that otherwise would not exist on those businesses.

Jeremy Wright: The Minister is right, but subsection (4)(a) refers to
“such prevention procedures” as are
“reasonable in all the circumstances”,
so in very many cases that would be a very minimal requirement and probably only what companies that are behaving responsibly are doing already. Secondly, as I am sure the Minister is about to point out, subsection (4)(b) states that it might not be
“reasonable in all the circumstances to expect the body to have any prevention procedures in place.”
So if it was not considered reasonable to have any, it would be possible to rely on that defence if they did not.

Kevin Hollinrake: I think my right hon. and learned Friend will accept there will also be a requirement to analyse actuarily the business to see what risks there are, and any perceived risk would of course require those prevention procedures to be put in place. We have analysed this and tried to get some context around the costs to businesses and think it would be in the order of £4 billion, so there would be significant burdens. For that reason, we are not persuaded to change our threshold.
Let me correct myself to the hon. Member for Rhondda (Sir Chris Bryant). I was only out by a factor of 100 when I talked about the number of warning notices sent to overseas entities; 1,000 warning notices have been sent.
The hon. Member for Feltham and Heston (Seema Malhotra) talked about the introduction of SLAPPs, and we are clearly keen to do that at the earliest possible time. We have to work with the Civil Procedure Rule Committee to implement a new cost protection scheme for SLAPPs defendants and the early dismissal mechanism via secondary legislation as soon as possible. We cannot give a definite date, however.
I thank my hon. Friend the Member for Cheadle (Mary Robinson) for all the work she does with the all-party group on whistleblowing, which I was heavily engaged with as a Back Bencher. We have a review of whistleblowing that should conclude by the end of 2023. On extending SLAPPs to areas of our economy outside the economic sector, we are considering further legislative options. Clearly, in this proposed legislation it could only pertain to economic crime due to the extent of the Bill.
The hon. Member for Glasgow Central (Alison Thewliss) rightly talked about enforcement resources and also some of the limitations in the current regime, and that is exactly why we are legislating. The provisions we will make will increase the incorporation fee for Companies House. In addition to the £63 million we have put in to pump-prime this work—the extra people at Companies House will therefore be resourced, and there are already  400 people there to enforce the provisions of this legislation—we expect to increase incorporation fees to around £50 and also to extend the costs of annual returns to raise the money as necessary to make sure that the requirements of the Bill are fully implemented.

Alison Thewliss: Given the woefully low number of fines for false filing and the single one for not registering a person of significant control for Scottish limited partnerships, will we see that increase?

Kevin Hollinrake: That is exactly why we are legislating. These are the biggest reforms to Companies House in 170 years. We have to legislate first and ensure that the resources and the enforcement are in place. We are on the same page in this area.
The right hon. Member for Barking (Dame Margaret Hodge)—my former partner in fighting economic crime, of course—made many good points, many of which I am sympathetic to. May I correct her on one particular area? She talked about people such as Abramovich and Usmanov and said that we have no idea about the stuff they are hiding in trusts. That is not the case, because HMRC and other law enforcement bodies have access to that information about trusts; it is not hidden from them. So it is not the case that we do not know about the assets held in those kinds of vehicles for those kinds of people. Clearly we will always listen to what she and others say to make sure we do the right thing to tackle economic crime without putting new, undue burdens on businesses.
In terms of money laundering, I might have got the right hon. Member’s figure wrong, if she said there was one fine for money laundering. There were 240 fines for money laundering by HMRC in the last six months of last year. There have been some very big fines, including the FCA fining Santander £107.7 million and HSBC £63.9 million for failings in their anti-money laundering controls. There is a significant regime already, although of course it can always be improved.
My hon. Friend the Member for North East Bedfordshire (Richard Fuller) does a brilliant job in standing up for SMEs and understanding the corporate governance process and regime. He is quite right: amendment 30 to clause 56 means that we will look at this area and make regulations to specify what it will mean to ensure that certain companies can hide some of the information we now require, such as accounts and balance sheets. My ambition is exactly as his is: that it should be a simple process like a tick box to conceal that information from public view in the cases he describes.
The right hon. Member for Birmingham, Hodge Hill (Liam Byrne) has done fantastic work in all this, and I am grateful for his kind words. He challenges why we would not gold-plate some of the existing provisions, such as on nominees or failure to prevent. The reason is that gold-plating costs money for businesses. That is why we are careful about duplicating existing regimes in the way we have set out already. I accept he wants us to go further, but we think we have good reasons for not going further than we have currently.
I am grateful to the hon. Member for St Helens South and Whiston (Ms Rimmer) for her kind words and her support for the offences on failure to prevent. Again, we want to make sure that those burdens are  proportionate, as we have set out previously. I know she would challenge us to go further, but we think we are striking the right balance.
To conclude, I urge all Members on both sides of the House to note the improvements that the Government have already made to this Bill and the critical importance of striking the right balance between taking action to tackle economic crime while being mindful of the burdens on legitimate business and therefore to vote with us today.
Question put, That amendment (a) to Lords amendment 23 be made.

The House divided: Ayes 295, Noes 205.
Question accordingly agreed to.
Amendment (a) made to Lords amendment 23.
Lords amendment 23, as amended, agreed to.

After Clause 180 - Failure to prevent fraud

Amendment (a) proposed to Lords amendment 151.—(Kevin Hollinrake.)
Question put, That the amendment be made.

The House divided: Ayes 297, Noes 209.
Question accordingly agreed to.
Amendment (a) made to Lords amendment 151.
Lords amendment 151, as amended, agreed to.
Government amendments (a) to (c) made to Lords amendment 153.
Lords amendment 153, as amended, agreed to.
Lords amendment 115 disagreed to.
Motion made, and Question put, That this House disagrees with Lords amendment 117—(Kevin Hollinrake.)

The House divided: Ayes 294, Noes 206.
Question accordingly agreed to.
Lords amendment 117 disagreed to.

After Clause 180 - Failure to prevent fraud and money laundering

Motion made, and Question put, That this House disagrees with Lords amendment 159.—(Kevin Hollinrake.)

The House divided: Ayes 291, Noes 209.
Question accordingly agreed to.
Lords amendment 159 disagreed to.
More than three hours having elapsed since the commencement of proceedings on the Lords amendments, the proceedings were interrupted (Programme Order, this day).
The Deputy Speaker put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 83F).

After Clause 187 - Civil recovery: costs of proceedings

Motion made, and Question put, That this House disagrees with Lords amendment 161.—(Kevin Hollinrake.)

The House divided: Ayes 292, Noes 206.
Question accordingly agreed to.
Lords amendment 161 disagreed to.
Government amendment (a) made in lieu of Lords amendment 161. Lords amendment 56 disagreed to.
Government amendments (a) to (c) made in lieu of Lords amendment 56.
Lords amendments 1 to 22, 24 to 55, 57 to 114, 116, 118 to 150, 152, 154 to 158, 160 and 162 to 229 agreed to, with Commons financial privileges waived in respect of Lords amendments 6, 7, 9 to 12, 14 to 21, 30, 32 to 34, 54, 68, 120, 124, 125, 173, 174 and 178 to 201.
Motion made, and Question put forthwith (Standing Order No. 83H(2)), That a Committee be appointed to draw up Reasons to be assigned to the Lords for disagreeing to their amendments 115, 117 and 159;
That Kevin Hollinrake, Scott Mann, Jane Stevenson, Alexander Stafford, Seema Malhotra, Taiwo Owatemi and Alison Thewliss be members of the Committee;
That Kevin Hollinrake be the Chair of the Committee;
That three be the quorum of the Committee.
That the Committee do withdraw immediately.—(Julie Marson.)
Question agreed to.
Committee to withdraw immediately; reasons to be reported and communicated to the Lords.

Northern Ireland Budget (No. 2) Bill

Considered in Committee
[Relevant documents: Northern Ireland Main Estimates July 2023, CP 884; Oral evidence taken before the Northern Ireland Affairs Committee on 3 May, 24 May, 21 June and 4 July 2023, on the funding and delivery of public services, HC 1165.]
[Dame Rosie Winterton in the Chair]

Rosie Winterton: We now come to—

Steven Baker: On a point of order, Madam Deputy Speaker.  I think the Mace is in the wrong place.

Rosie Winterton: Very well spotted—it will be moved. Thank you.

Clause 1 - Use of resources

Question proposed, That the clause stand part of the Bill.

Rosie Winterton: With this it will be convenient to consider the following:
Clauses 2 to 9 stand part
The schedule.
I should point out that no amendments have been selected, so colleagues will need to speak very specifically to the clauses, should they wish to speak, but there will obviously be an opportunity for Members to contribute on Third Reading as well.

Steven Baker: Thank you, Dame Rosie, and I am delighted to serve with you in the Chair today as we go through Committee stage of this vital Bill.
In the absence of a functioning Executive, this Bill will allow public services to continue functioning and help to protect public finances in Northern Ireland. I propose to go through the clauses now, and then with the permission of the Committee, respond at the end of the debate to points raised.
Clauses 1 and 2 authorise the use of resources by Northern Ireland Departments and other specified public bodies amounting to £27,403,514,000 in the year ending 31 March 2024 for the purposes specified in part 2 of schedule 1 and subject to the limits set out in subsections (4) to (7) of clause 2. I should remind the Committee that this Bill only sets out the available total resource and capital budget for Northern Ireland Departments of £14.2 billion and £2.2 billion respectively. In the absence of an Executive, it is the responsibility of the Northern Ireland Departments now to make the specific spending decisions to ensure that they live within the budget limits set out in this Bill. The Government recognise that this is not easy and requires difficult decisions.
Clauses 3 and 4 authorise the Northern Ireland Department of Finance to issue out of the Consolidated Fund of Northern Ireland the sum of £22,790,893,000 for the purposes set out in part 2 of schedule 1.
Clause 5 authorises the temporary borrowing by the Northern Ireland Department of Finance of £11,395,447,000, approximately half the sum covered by clause 3. This is a normal safeguard against the possibility of a temporary deficiency arising in the Consolidated Fund of Northern Ireland, and any such borrowing is to be repaid by 31 March 2024.
Clause 6 authorises the use of income by Northern Ireland Departments and other specified public bodies from the sources specified in part 3 of the schedule for the purposes specified in part 2 of the schedule in the year ending 31 March 2024. Clause 7 provides for the authorisations and limits in the Bill to have the same effect as if they were contained in a Budget Act of the Northern Ireland Assembly. It also modifies references in other pieces of legislation to the Northern Ireland estimates, which would normally form part of the Assembly’s supply process. Clauses 8 and 9 are self-explanatory, in that they deal with such matters as interpretation and the short title.
Finally, the schedule to the Bill sets out for each Northern Ireland Department the amount of money authorised for use, the purposes for which it can be spent and other sources of income from which it can draw. Part 1 of the schedule sets out the amount of resources authorised for use by each Northern Ireland Department and other public bodies in clauses 1 and 2 and the sums of money granted to each Northern Ireland Department and other bodies in clauses 3 and 4 for the year ending 31 March 2024.
Part 2 of the schedule sets out the purposes for which resources under clause 2 and money under clause 4 can be used by each Northern Ireland Department and other bodies for the year ending 31 March 2024. Finally, part 3 of the schedule sets out the sources from which income can be used by each Northern Ireland Department and other bodies for the year ending 31 March 2024.
I hope I have provided the Committee with sufficient detail on the intended effect of each provision in the Bill. We have also published more detailed information in respect of each of the Northern Ireland Department’s spending plans through the main estimates, which the Secretary of State laid as a Command Paper on 3 July. I look forward to hearing Members’ views on the Bill and their contributions, and with the leave of the House I will later endeavour to respond to as many points as possible when I wind up.

Tonia Antoniazzi: It is an honour to serve under your chairship, Dame Rosie, in this Committee. I will keep my remarks brief to allow us to hear from the Northern Ireland parties on Third Reading.
Once again we come together to debate legislation that should be dealt with in Stormont. We still have civil servants running Departments with restricted powers, trying to plug a gap of £800 million and unable to consult with Cabinet Ministers. Stormont is the right and proper place for scrutiny to take place. In this place, we cannot simply provide the level of consideration and scrutiny that this budget deserves.
To quote today’s report from Pivotal,
“managing this situation has been extremely challenging, if not impossible, thanks to two interlocked problems: no political leadership for decision-making and impossibly tight budgets.”
On the first problem, sadly I have seen no sign over the recess that indicates the restoration of the Northern Ireland Executive is any nearer. I would welcome hearing from the Secretary of State what discussions he has had over the summer with parties in Northern Ireland, as the situation is now beyond breaking point.
On the second problem—the budget—we do not oppose the Bill, as services are in desperate need of funding, but the fact is that this budget is not enough to address the problems facing public services in Northern Ireland. A real-terms funding fall of 3.3% means that existing services simply cannot continue to function as normal. The people of Northern Ireland have been left facing cuts to support and increases in charges for everyday necessities during the cost of living crisis. While we appreciate the need to explore avenues to raise revenue, the measures put forward so far may cause more societal damage than the monetary gain is worth. As I have mentioned, we are missing a vital level of scrutiny and accountability for these measures.
We, the Labour party, agree with the principle that local decisions should be made by local politicians, but the situation is now extreme. While there continues to be no functioning Executive, I ask the Secretary of State to consider what he can do within his power to help the people of Northern Ireland. This is a critical state of affairs, and the full impact may not yet be realised, as any overspends will inevitably lead to further cuts the next year. The only viable way forward for Northern Ireland is the restoration of the Executive, and I implore the Secretary of State, the Minister and the main parties in Northern Ireland to ensure that happens sooner rather than later.

Simon Hoare: If I may, I will both put on record my thanks to the hon. Member for Hove (Peter Kyle) and my congratulations on his new job, and welcome the right hon. Member for Leeds Central (Hilary Benn) to his new position. I remember the speech the right hon. Gentleman gave in our debate on the anniversary of the Good Friday agreement, just before the Easter recess, which showed a depth of knowledge of, interest in and love for Northern Ireland. I am sure that the Secretary of State, the Minister of State and, indeed, the Northern Ireland Affairs Committee look forward to working with him in the weeks and months ahead.
While I understand that new clause 1, tabled in my name and that of my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland), has not been selected for debate, I hope that the Minister will give some consideration to the merit that underpins the argument with regard to the maintenance of the Audit Committee, notwithstanding Stormont not being in place.
The hon. Member for Gower (Tonia Antoniazzi) is absolutely right. The delivery of public services in Northern Ireland is under huge pressure as a result of the covid backlog in health, as we know, and an increase in demand with a shrinking supply. The recent events with regards to the PSNI will clearly be putting additional pressures on other budgets as well.
The restoration of Stormont would not provide all the keys to unlock all the currently locked or semi-locked doors, but, by God, it would make a huge difference. The hon. Lady is right on that. I have said right from  the start that one can understand the points and principles of the Democratic Unionist party with regard to the protocol and the Windsor framework, but I think the Government have made it clear that will not change; it just has to be made to work. The Minister in the other place has signified that there will be additional statutory instruments. My cri de coeur is one that I have made before—it has hitherto fallen on deaf ears. This is a situation affecting public services and those who are most reliant on them. Those people—protected to some extent by this necessary budget Bill—have no choice other than to use the services provided by the state and the public sector. They cannot go elsewhere. They are looking to local politicians with a depth of understanding to find the answers to these questions.
I appreciate that this is a slightly wider point, but this Bill is required—it is brought about not through the desire of Government but through necessity. That necessity could end, and it could end tomorrow. That would lead to better governance, better decision making and transformational approaches to the delivery of public services, getting more bang for the buck and a better uplift for the people of Northern Ireland. Those of us who are committed to public service should be seeking that. I therefore support the Bill, and will support the Government in any votes in Committee or on Third Reading, but it is a sad day when we have to pass such a Bill because of some who are resiling from the positions of trust to which they have been elected.

Robert Buckland: rose—

Rosie Winterton: I will call the right hon. and learned Gentleman, but I remind colleagues that there are Third Reading speeches and Committee speeches, and general discussion about the merits of the Bill is probably safer in Third Reading.

Robert Buckland: Thank you Dame Rosie. I will trespass upon your good will by focusing on clause 1 and the necessity of what we have to pass today. I will not repeat the comments of my hon. Friend the Member for North Dorset (Simon Hoare), which I think are sadly axiomatic in a situation that is difficult and not in the long-term interests—or even the short-term interests—of the people of Northern Ireland. It is certainly not in the interests of sustainable public services.
On the Northern Ireland Affairs Committee, we hear time and again from interested groups from the voluntary sector and the third sector in Northern Ireland about the difficulties they face with the absence of long-term planning and multi-year budgets, and the effect on their ability to retain and hire people who can do the important work of providing and helping to support public services, whether in the field of health, education or disability, for example.
There was interesting evidence from the Northern Ireland Audit Committee about the fact that, while in the rest of the United Kingdom, in Scotland and in England and Wales, the National Audit Office has a life of its own and is independent of whether Parliament sits—it can carry on through the election period, for example—that is not the case in Northern Ireland. It means that, in the absence of an Assembly, the committee  cannot function. We are talking about not a party political body but an independent organisation that is able to audit, check and make sure that public bodies such as the Northern Ireland Office—those given the task of administering public funds—are doing so responsibly and in a way that is consistent with their duties, so that they can be held to account in the way that Departments of state here in England and Wales and Scotland are held to account by their respective audit bodies. That is a material difference and a disbenefit to Northern Ireland as opposed to the rest of the United Kingdom.
I am sure that there are more public bodies of that nature, whose existence or continuance depends on the sitting of the Assembly, which could benefit from being free from those shackles, doing independent, non-partisan, non-party political work. This would be a very good place to start.

Steven Baker: My right hon. and learned Friend makes a very good case. I am conscious that his amendment was not selected, but if he would do me the honour, I would be glad to meet him and hear his opinions on this further. He makes some very good points.

Robert Buckland: I am extremely grateful to my hon. Friend, and I would commend him for any discussions he might have with the Audit Committee and its members who have given evidence to the Northern Ireland Affairs Committee here in Westminster.
On that note I will close my remarks. It is safe to say that it is sad but a reality at the moment that we have to legislate in this way for the affairs of a part of our United Kingdom that has been given the power of devolution but, for reasons that are all too apparent, is not in a position to exercise that power. It must do so soon, not in the self-interest of the politicians who sit in that place but for the people they are supposed to serve.
Question put and agreed to.
Clause 1 accordingly ordered to stand part of the Bill.
Clauses 2 to 9 ordered to stand part of the Bill.
Schedule agreed to.
The Deputy Speaker resumed the Chair.
Bill reported, without amendment.
Third Reading.

Steven Baker: I beg to move, That the Bill be now read the Third time.
I would like to place on record my thanks to all those involved in the passage of the Bill through the House. In particular, I thank the Labour Front Benchers for their constructive approach to the Bill and its necessity. I take this opportunity to welcome the shadow Secretary of State, the right hon. Member for Leeds Central (Hilary Benn), to his place; I know he will hold us to account with great skill, but will seek to pursue the best interests for the people of Northern Ireland. I heard him say “peace, prosperity and progress”. That is what we all want.
I thank Diggory Bailey in the Office of the Parliamentary Counsel for the expert fashion in which he and colleagues drafted the Bill with Northern Ireland counterparts in the Office of Legislative Counsel and the officials in the Department of Finance who assisted greatly in our preparation for this Bill’s passage.
It is no secret that the pressures on Northern Ireland’s public finances are acute. As with the 2022-23 budget, setting the budget was not an easy task but it was necessary to deliver a balanced budget and provide the Northern Ireland Departments with budget clarity to help to get spending under control. As far as possible, we have aimed to protect frontline public services. In recognition of the pressure on the health service, over half the total budget is earmarked for health.
As I have said many times from this Dispatch Box, and as the Secretary of State for Northern Ireland has said many times, people in Northern Ireland rightly expect to see these decisions taken in Stormont and not in Westminster. We agree with them. However, until that happens, the Bill will allow public services to continue functioning and help to protect public finances in Northern Ireland. I therefore commend it to the House.

Hilary Benn: May I begin by expressing my thanks to my predecessor, my hon. Friend the Member for Hove (Peter Kyle), who has already been mentioned this evening, for the outstanding contribution he made in this role and to wish him well in his new job?
It is clear from the debates during the Bill’s passage that the current situation was not sustainable, hence the need for the Bill. Public services are under strain. Indeed, the Minister has just said that the pressures are acute and I agree with him. It is noticeable that the Bill has been widely perceived as a budget that does not take account of those needs and those pressures. It is clear that we cannot keep setting budgets in this way and that the structural problems in Northern Ireland are getting worse in the absence of an Executive. It is not fair or right to ask civil servants to make decisions which politicians should be making. The political vacuum in Northern Ireland is having serious consequences. The crisis facing the police service is all too evident—we discussed that earlier today in the urgent question—and the Secretary of State heard many references to the financial pressures it is already facing, never mind the costs that may arise from responding to the data breach. But there are concerns about other Departments, too. NHS waiting lists for Northern Ireland are the worst in our country. There are reports that Northern Ireland schools are only now being surveyed for structural weaknesses caused by reinforced concrete. If that finds that costs are required to be met to repair or replace those roofs, will that money have to come out of the budget set by the Bill? I understand that the Secretary of State has received advice from civil servants about possible revenue-raising measures. How does he plan to use them? Will they be published?
Those and other challenges are the stuff of Government. It is what we are elected to deal with wherever it is that we sit, but that is not happening in Northern Ireland at the moment and it needs to in the interests of its citizens, a point made very clearly by the hon. Member for North Dorset (Simon Hoare), who chairs the Northern Ireland Affairs Committee. On Second Reading before the recess, the Secretary of State said:
“The summer therefore presents an opportunity for the Northern Ireland parties to come together as a restored Executive and take their own budget legislation through the Assembly, making the remaining stages of the Bill in this place superfluous.”—[Official Report, 10 July 2023; Vol. 736, c. 101.]
Now, we would all wish that that had happened but, as my hon. Friend the Member for Gower (Tonia Antoniazzi) pointed out, it is not entirely clear what was done over the summer by the Government to try to bring the Northern Ireland parties together. We know that the Prime Minister was very happy to visit Northern Ireland after the Windsor framework—a great achievement, but it was meant to restore power sharing—but his absence since has been noticeable. And it is not clear, to be honest, what the Government’s plan is now to regain trust, including by responding to the continuing concerns expressed by the Unionist community in Northern Ireland to enable the institutions to get up and running again.
The Labour party does not oppose the Bill as to do so would cause deeper instability, but, as I think everybody who has contributed so far tonight has said, the best and only way forward is the restoration of Stormont so that local representatives can get to grips with the budget and be accountable to the people who elected them, the people of Northern Ireland, for the decisions they make. Frankly, that day cannot come soon enough.

Rosie Winterton: I call the Scottish National party spokesperson.

Richard Thomson: I, too, welcome the right hon. Member for Leeds Central (Hilary Benn) to his new position, and I look forward to working alongside him as we discharge our respective roles in opposition to the Government.
I will begin with the now customary bromide that we all wish we were not here to discuss this, and that all the relevant decisions should be made in Stormont, which should be up and running again, scrutinising a functioning Executive—but the fact is that we are back here, and, as I said on Second Reading and as other Members have also said, this is not a budget in any meaningful sense. It is about the allocation of money and what it can be spent on, but it is devoid of any political steer for the emerging priorities and challenges facing communities in Northern Ireland. It is a hospital pass given to the civil servants who have been left to administer, effectively, a salami-slicing exercise with little more than the guidance that they
“must control and manage expenditure within the limits of the appropriations set out in Budget Acts”.
Even within that total, however, the budget has reduced the overall amount available to departmental budgets in Northern Ireland, which means that funding is heading in the opposite direction not only to the pressures of inflation, but to demand for public services and the pressing need—in a cost of living crisis—to negotiate a fair set of settlements across the public sector. Overall, even with the spending decisions that can lawfully be taken at the moment, Northern Ireland is heading for a budget overspend of about £500 million. Expressed like that, it just sounds like a big number, but it is a big number with enormous consequences, and, as ever, those who will be affected are the most vulnerable groups in society, the least well off, and those who are most dependent on public services.
It is not my intention to go through every line of the budget and all the programmes that will be cut, the services that will be reduced and the areas in which  people will simply have to do with less in the absence of decision making. However, it is plain that ministerial decisions are urgently needed for the setting of a budget with the necessary strategic direction, which can provide the clarity that will enable the civil service to work with it and deliver not just sustainable public finances, but sustainable public services.
Let me suggest to Ministers, as gently as I can, that standing back and watching Northern Ireland’s public services suffer with less money, and observing the consequences in communities, is a tactic that will have limited effect if the intention is to drive people back to negotiations. The solution to a non-functioning and non-sitting Stormont clearly lies elsewhere. I do not underestimate the challenge that will eventually face an Executive when one can return, but nevertheless this is not the way to bring about the set of circumstances that we all wish to see. The solution that will enable Stormont to sit once again, and enable an Executive to be formed and to function, self-evidently lies elsewhere, and I urge Ministers to continue to do all that they can—to do more, in fact—to help to bring that about.

Sammy Wilson: The hour is late, so I will make just a couple of points about the budget. The first is that, of course, political parties in Northern Ireland have elected representatives. We have our own priorities. We have things that we want to see done, and things that we believe should not have money spent on them. Of course we would love to be in a situation where we had a restored Assembly, but I think that the new shadow Secretary of State—whom I congratulate on his appointment—hit the nail on the head when he said that Government had a responsibility to regain the trust of the parties of Northern Ireland, and this Government have singularly failed to do so. One only has to look at the way in which they have handled affairs since the Windsor framework was introduced. They took Members off Committees because they suddenly realised that the arguments being put forward for legislation were not even going to wear in their own party, so at the last minute we had half the Committee replaced. Over the summer period we have had regulations introduced without any chance of public scrutiny. That enabling legislation will have an impact on trade between Northern Ireland and the rest of the United Kingdom. Now we are heading towards the autumn, when the border operating model will see checks on goods coming from GB into Northern Ireland, as well as Northern Ireland manufacturers and producers finding themselves subject to checks when they try to sell into the GB market. The Government say that they want to restore trust and give us an assurance that we are part of the United Kingdom and a fully integral part of the United Kingdom market, but there is no evidence of that.
Quite honestly, no Government can expect Unionist representatives who have fought to maintain the Union to go back into Stormont to implement policies that will drive a further wedge between Northern Ireland and the rest of the United Kingdom, and where they will be obliged to accept EU legislation, which even the Windsor framework indicated would be the cause of divergence between Northern Ireland and the rest of the United Kingdom.
If the Government really want politicians in Northern Ireland to play a role in deciding budgets and how they are spent, they first of all have to accept that Unionists cannot and should not be expected to participate in the demise of the Union by having to sit in an Assembly that would be forced to implement the very policies that they believe are detrimental to the Union. It would be hypocritical for DUP Ministers and Unionist Ministers to sit in the Assembly and by law—because the courts have ruled on it—have to implement something that their colleagues could be standing here in this place condemning and saying was detrimental to the Union. There is an onus on the Government to recognise that the Windsor framework has not sorted out the issues and that it has made them worse. I think that October will show that it has made them worse, and if we want devolution restored, it has to be on the basis of—

Steven Baker: I am listening carefully, and I appreciate the tone in which the right hon. Gentleman is delivering his remarks, but I have stood here at least twice and said that we recognise that this is a hard compromise for Unionists and Eurosceptics. I think it has to be said that the European Union has its own stakeholders. Personally, I was among those who said for a long time that we could have administrative and technical solutions to deal with the issues of Northern Ireland. I worked on that before the referendum and subsequently I saw to it that papers were produced after I resigned from the Government in 2018.
This is a subject extremely close to my heart, but since the right hon. Gentleman raises it again, I would say to him and to all Unionists, of whatever strength of opinion, that one has to choose from the available futures. He knows that; he is a more experienced politician than me. One has to choose from the available futures. The EU has its own stakeholders. We have managed to reset the relationship with Ireland and with the European Union, and that offers the hope of a better future for all of us in western Europe.
On the budget, the surest way to harm the Union now is to allow Northern Ireland to fail, because people vote for change when the world is not working for them. When I look at the available futures for Northern Ireland, I see that the one that is going to work best and best preserve the Union is to get on and get Northern Ireland working. I know that the right hon. Gentleman is frustrated. I am frustrated, too, and I would like to have done better on the Windsor framework, but now we have to choose from the best of the available futures.

Sammy Wilson: That is the kind of answer that worries me as a Unionist, and it should worry many people in the Minister’s party if they listen carefully.
The Minister seems to be taking the view that, because stakeholders in the European Union demand certain things, the Government should respond. This Government have an obligation, first of all, to the country they govern, and that obligation is to make sure the country is not broken up. That should be the main consideration, not what stakeholders in Europe think and not re-establishing relations with the European Union and the Government in Ireland, if that means breaking off and destroying relations with the people of part of the country to which we belong. If that is the approach, I do not think we will get very far. This surrender approach  is not a compromise that Unionists can accept. The Minister may find it acceptable, but we do not find it acceptable.

Steven Baker: I know this is a debate on the budget, so I will try to be very brief. I know the right hon. Gentleman does not need me to give him a lecture on the Belfast/Good Friday agreement, but Northern Ireland has had particular problems and a particular status that do not exist in my constituency or anywhere else in Great Britain. We have to face up to the reality of where we are. This Government believe in the Union, but we also respect the Belfast/Good Friday agreement in all its dimensions, and that includes devolution. I implore him to make the Union work.

Sammy Wilson: Of course, the important thing in the Belfast agreement was that the status of Northern Ireland is guaranteed, and that no change would be made to Northern Ireland’s status unless it is decided by the people in Northern Ireland. The people in Northern Ireland did not agree to this change of status, which makes it a vassal state of the European Union.
I do not want to labour the point—I understand that you are being very good in allowing me to emphasise this point, Madam Deputy Speaker—but if the Government wish to see Northern Ireland politicians make decisions on this, they have to respect that there is a Unionist tradition and a nationalist tradition in Northern Ireland. They cannot ignore the Unionist community’s concerns, worries, fears and opposition to the arrangements that are currently in place. Far, far worse, they cannot expect Unionists to co-operate in facilitating the implementation of those arrangements.
On the budget, the Minister has accepted that there is pressure on public services and spending in Northern Ireland. Nearly everyone who has spoken has said that it would be much better for politicians in Northern Ireland to make these decisions. The truth of the matter is that, even if the Assembly were up and running, it could not deliver the basic services that are expected in Northern Ireland and that are funded in the rest of the United Kingdom, because the Government have done two things.
First, since 1922—and the Fiscal Council has made this clear—expenditure on public services in the rest of the United Kingdom has been based on need, but the Government have ignored their own criteria and the basis on which they decide spending in the rest of the United Kingdom. The Holtham formula has not been applied in Northern Ireland. Indeed, the Fiscal Council has estimated that, as a result of need not being considered, we probably have about £322 million less expenditure available than we would have had if we had been treated on the same basis as England, Scotland and Wales.
I do not believe the Assembly’s decisions have always been good, and I do not believe there has always been the wisest use of money, but the problem has not primarily been caused by the Assembly. The Government’s decision not to base this budget on need is causing some of the issues.
Let me give an example. Education spending has gone up by 6% in the rest of the United Kingdom, but it has fallen in Northern Ireland. The overall budget for Northern Ireland this year has fallen by 3.2% in real terms, whereas the budgets for the rest of the United Kingdom went up by 1.7% in real terms. That is partly a  result of the fact that the formula used for the rest of the United Kingdom, which is based on need, has not been applied in Northern Ireland. Of course, the situation has been exacerbated by the Government’s decision to claw back the overspend by the Assembly in the last year in which it was sitting, which amounts to about £287 million. So the pressure on public services, which the Minister has lamented, is partly caused by the decisions that have been made here; they will affect the amount of money we have to spend in Northern Ireland.
I could go through the consequences for each Department, but I am not going to do so at this time of the evening. However, in education we have a real-terms cut, and in policing we are already about 1,000 officers below what the New Decade, New Approach and the Patten arrangements said we should have. That situation is going to get worse. Of course, we also now face the expenditure that is going to be necessary because of the problems in schools and the massive expenditure that will result from the data breach in the Police Service of Northern Ireland. So far, no clear indication has been given that the payment for those things will come from anything other than this overstretched budget. It would be useful for the Minister to indicate to us at the end of the debate whether the money that has to be spent on making schools good as a result of the problems with the concrete that was used, and the massive spending that there will be on fines from the Information Commissioner, the relocation of officers and the mitigation measures that have to be taken to protect officers, will still come from the overstretched budget or whether there will be an in-year consequence for that. Alternatively, will it be treated simply the same as the Barnett consequentials? Will the future Barnett consequentials be treated and ignored?
I hope that the Minister fully understands our position. We are not being truculent. We are not piqued because we have not got our way. We are simply making it clear that the ask that is being made, on the political compromises on the Union and on the financial difficulties that this budget would cause, makes it impossible for the Assembly to be up and running again.

Claire Hanna: I start by thanking the hon. Member for Hove (Peter Kyle) for his service as Opposition spokesman. He was an enthusiastic and frequent visitor to Northern Ireland, and that was always appreciated. I warmly welcome the right hon. Member for Leeds Central (Hilary Benn). His is a widely welcomed appointment; he is a very substantial person and I just hope he is not regretting his life choice having watched this evening’s debate.
I will not rehearse all that we and others said on Second Reading, except to say that this is, unfortunately, another milestone of failure, delivering this budget in this place. It is another blow to public services and to public faith in politics in Northern Ireland. As we said before the summer, this is about choices. Every budget that everybody has to make faces choices, some of which are difficult and will not be popular with everybody. However, the choice to withhold government is one rejected by the overwhelming number of people in Northern Ireland, of various different backgrounds, most of whom, whatever our differences, want to  choose devolved government, hard work, partnership  and compromise, as my party is doing. Yes, that includes compromise on constitutional issues, which many of us do every day of our lives when our identity does not match up exactly in every way with the Government we have. However, we work at it and we work on the common ground, in the interests of all the people.
In the interests of protecting those services, on Second Reading we put forward our detailed triple lock proposals, which were a way to protect services from the short-term sharp cuts and to create a pathway to longer-term reform that the public services need. As Members will know, at this stage of this budget we have also tabled a proposal to design an informal consultative role for the Irish Government on these budgetary decisions.
Plan A is a reformed Stormont, where everybody makes decisions together. Plan B is changing the rules to allow those who want to work to do so, but we are registering the principle that hanging around for month after month, doing nothing about the challenges facing Northern Ireland, drifting into the cosiness, for some, of direct rule is just not good enough. The rest of us get to have views and opinions, and good governance as well.
This is not a proposal for joint authority, but Democratic Unionist party Members should be aware that the longer they insist that Northern Ireland cannot work, the wider, deeper and louder the conversation about our changed constitutional future will be. There are big choices ahead about our future, but also about the here and now; it is the here and now that this Budget impacts so substantially. As we outlined before, it has a catastrophic impact on health, education, climate resilience and economic opportunity.
At the weekend, the Secretary of State said that there would be no sticking plasters, but the allocations do not even allow for any healing. For example, next week Northern Ireland will host an investment conference. We will seek investment not only against the backdrop of the governance black hole but with over 100 areas of Northern Ireland that cannot be developed at the moment because of a serious lack of wastewater infrastructure. However, this Budget means that the Government—the 100% shareholder—will not invest in that infrastructure or follow the proposals made by the utilities regulator. That is literally, in a very direct way, impacting not just the environment but our economic future.
The think-tank Pivotal has produced a sobering report, which I hope every Member here will read and absorb, called “Governing Northern Ireland without an Executive”. It details the impact of the neglect and the long tail of the damage that these periods of desertion have on everybody in Northern Ireland. We have a shortfall of about £800 million and the most vulnerable have a bleak year ahead. People in Northern Ireland feel that a global game is being played with them and around them. I say to those people who manipulate the public and leave the public hanging, and then try to get them to go along with their proposals and have faith in them about the constitutional future: it is not going to work.

Gavin Robinson: It is a pleasure, as always, to follow the hon. Member for Belfast South (Claire Hanna), my constituency neighbour, but the content of my speech will be slightly different from hers.
I will not delve into the Committee stage, amendments that were tabled but not brought forward, or amendments that were needlessly provocative and stepped far away from the principles that the party that tabled them purport to stand for, but I want to talk about the Northern Ireland Budget (No. 2) Bill, which is the second such budget Bill that has been before this House this year.
When we discussed the original Bill, it was just called the budget Bill, rather than No. 1 or No. 2. We were dealing with last year’s financial position and, at that stage, Members from my party introduced the discussion around need. We challenged the Government about their understanding of need, and we were patronised at that time. We were told, without any sense of irony, shame or knowledge of the facts, that in Northern Ireland we are over-funded and get £1.21 for every £1 that is spent in England.
But still we tried to bring the conversation back to assessed need and the similar process that Wales had to go through over five years with the Holtham Commission. However, there was no sense that the position that we were outlining, identified by the Northern Ireland Fiscal Council in September last year, was a position that recognised that while our Budget may grow by 3.6%, public spending in England was going to grow by 6%, or a recognition that by the end of this financial cycle households in Northern Ireland would each be £2,000 less well-off than their counterparts in the rest of the United Kingdom, and therefore there was a budgetary problem. It has taken from January of this year to now for that seed to start germinating.
When there is a recognition in public discourse that this is a punishment budget before us this evening—this has been described as a punishment budget, which has been ignored by those in power—and no decision is taken to change it meaningfully or beneficially for the people of Northern Ireland, it will hurt us economically. We cannot systemically assess Northern Ireland public finances and know that what Northern Ireland gets is less than what it needs and not recognise that that has a material impact on the delivery of public services. Yet that is exactly what we are discussing this evening. The Fiscal Council has now published and what it says is recognised. I remember the back and forth with the Chairman of the Northern Ireland Affairs Committee. I was grateful that he took on my request to carry out an inquiry on this issue. He has been on a journey and now recognises that when the Fiscal Council says what we need to deliver effective public services with £1.24, we are getting less than what we need. When that is done year on year, there is a compounding negative impact. It means that every year we are starting with less and that this budget simply has a recurring feature of making sure that public services in Northern Ireland are denied the money that they need to be operated effectively.
I know that repetition is not sinful in this place, but it is worth reiterating time and again that, until the Government embrace this discussion meaningfully and properly, Northern Ireland public services will not be able to flourish. Drastic decisions that are being taken and have been taken will continue to be taken.

Simon Hoare: What the hon. Gentleman is saying is undoubtedly true, but does he also accept—I think the Select Committee has been hearing this during our  inquiry—that there is a real sense of frustration among many of the professional practitioners about the absence of the delivery of transformational change: delivering public services in a different way; or getting more bang for the buck, to put it more crudely. A functioning Executive in Stormont would lead to some big, bold and brave decisions. I understand that would be difficult for parties across the piece, but trying to deliver public services in the same old way in the absence of transformational change, given budgetary pressures across the public purse in respect of whichever party in the UK, is an opportunity that is missed and is to the detriment of people across the whole of Northern Ireland.

Gavin Robinson: The best that can be hoped for in this scenario is that a return to devolved Government means that locally elected representatives and Ministers in an Executive can make the choices based on the information put before them. The hon. Gentleman cannot—nor can I—dictate what those choices should be. The choices have been there for previous Executives, yet I may argue that the wrong decisions have been made. But what I am suggesting in the here and now is what we can control. Not only are we continuing to finance less than what we need, but we are continuing to break parity between the delivery of public services in Northern Ireland and England, Scotland and Wales.
The former Secretary of State, the right hon. Member for Skipton and Ripon (Julian Smith), who is in his place, will remember the pay award parity issue that abounded whenever he was embarking on the New Decade, New Approach discussions in 2019, culminating in a deal in 2020. The first nursing strike ever in any part of the United Kingdom was based on that pay parity issue alone. And here we are, just three years later, and parity has broken again. Here we are from the last financial year and we recognise that there is not only a £500 million projected overspend this year, but a £575 million public pay pressure. When we add on the overspend from last year, which was £297 million but now seems to be £254 million, the figure, whatever it is, takes us close to a deficit of £1.3 billion.
I agree with the Secretary of State when he said—I am sure with much thought—that Northern Ireland does not need the sticking plaster of a one-off financial package. Let me be very clear that not one person from my party, or anyone sensible from Northern Ireland, has suggested that what we need is a one-off, one-year sticking plaster to fix a problem that is of this Government’s making. We are asking for a pragmatic and mature reflection on how much it costs to deliver Northern Ireland’s public services, and to get on with recalibrating the Barnett formula to ensure that we can do so. That is what we need. That is not yet what we have. The choices will be there for a new Executive.
The second most drastic thing that I think the Government have introduced into the debate is the notional view that we just need to get on and raise revenue. You have heard it, Madam Deputy Speaker. The Minister mentioned it this evening: a £27 billion budget for the forthcoming year. Take household rates, the biggest household contribution to the public finances that individuals make outside of tax and national insurance, with £1.7 billion raised each year. Can we honestly imagine indicating in a cost of living crisis to our  public, businesses and wider society that they should double their domestic and non-domestic contributions to household rates? Doubling them would allow us to get close to where we need to be. No problem. By 2025, we will have £2,000 less than every household in England, but add another £2,000 on, please, to stand still. Get real. Transformation? I have an idea: let us raise money by increasing tuition fees.
That brings me back to when I replied to the hon. Member for North Dorset about the choices that an Executive will have. We cannot determine those, but in the past whenever people were saying that there should be an increase in tuition fees it was for a beneficial outcome. Increase tuition fees and we can get rid of the maximum student numbers cap. Increase tuition fees and we will be able to fund more places so that our best and brightest will no longer have to leave Northern Ireland to be educated in England, Scotland and Wales, or anywhere else in the world. Those were positive benefits from an increase in tuition fees, yet it was never politically acceptable. Now what is on offer is just raising the cost to stand still, or to provide public services when we know that what we get is not sufficient to match the need.
Nobody is asking for a sticking plaster. Nobody can say what the choices shall be. I did not intend to speak for as long as I have, and I want to let other people contribute, but here we are again, with the second budget Bill of the year and the same challenges. It is progress at least that on 5 July the Deputy Prime Minister accepted for the first time, in response to a question from my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson), our party leader, that finances in Northern Ireland need to be predicated on need. That was the first time that we had heard that. Having been dismissed and ignored in January, we had acceptance of it in July. Yet the challenge is there for the rest of the financial year.
The punishment budget that has been outlined and is being advanced this evening will continue to cripple the effective delivery of public services in Northern Ireland. I have heard nothing from the Northern Ireland Office, or from anyone else around Government, to suggest that they are in the space of turning that around within this financial year. We are halfway through it. We want to see political progress, but the idea that we get political progress only for an incoming Executive to falter because they cannot deliver for the people would be the biggest crime of all.

Stephen Farry: At the outset, may I join in paying tribute to the outgoing shadow Secretary of State, the hon. Member for Hove (Peter Kyle), and in welcoming to his new role the right hon. Member for Leeds Central (Hilary Benn)? We are going to miss him on the UK Trade and Business Commission, on which he has had a very keen interest in recent years in Northern Ireland and the fallout on it from Brexit, which has had major ripple effects through our politics—not least, as we can hear this evening, on the subject of this debate.
It is six weeks on from Second Reading and it is fair to say that the situation in our politics has not improved. There is no sign of any return to devolution; indeed, the  response from the right hon. Member for East Antrim (Sammy Wilson) to the Minister of State illustrates the lack of realism about the choices that face us collectively in Northern Ireland, and the choices that face Unionism in ensuring that Northern Ireland works for everyone. That is in everyone’s interest, not least the interest of Unionists.
With the public finances, I would argue that the situation is indeed much worse than it was six weeks ago, because the Northern Ireland budget is on an unsustainable trajectory. The budget that was set, as others have said, was not sufficient—it was inadequate—but there is a second layer to this, because the guidance to civil servants in the Northern Ireland (Executive Formation etc) Act 2022 does not allow them to take the decisions necessary to live within the measly budget that has been granted.
As the hon. Member for Belfast East (Gavin Robinson) has said, we already have a situation where it is projected that Northern Ireland will overspend by at least £500 million, which is greater than the overspend from the last financial year. That is more than £500 million of public pay pressures before Northern Ireland can even have parity with the settlements that have taken place elsewhere in the United Kingdom. Something is going to have to give. Either an Executive come in with a financial package and can begin to address some of those pressures, or the Government are essentially going to take it on the chin and accept that Northern Ireland will overspend.
That begs the question of what will happen with that overspend in future years. Will it be an albatross around our neck for years to come? Will people be expected to make cuts, or will the Government make cuts in-year to try to balance the budget? I would suggest that trying to do that in-year is now impossible, not least because so much of our budget is linked to salaries. We would lose people, and even if we did we would have to have redundancy payments for them. The only way anyone could possibly balance the budget at this stage is through stopping services completely, which is utterly inconceivable and untenable.
The point has been made that the budget situation is bad and will always be bad, and that having an Executive does not make any difference in that regard. I am not suggesting for one minute that a restored Executive will be a silver bullet, but I suggest to my colleagues who perhaps are dismissing the relevance of devolution at this point that every single stakeholder, when they are asked to comment on the budget crisis, stands up and says, “We want to see an Executive in place.” Whether we are talking about healthcare professionals or people who work in the education sector, the business community or the voluntary community sector, all of them are saying with one voice, “While it is no magic solution, we do want to see the Executive back in place.”
That reference to a restored Executive leads me on neatly to the point I really want to stress regarding a financial package: we need to see a twin-pronged approach to addressing Northern Ireland’s financial needs. Of course we need to address the lack of financial parity and the fact that Northern Ireland is not funded based  on need. There is a structural problem of underfunding there, so things are not more generous in Northern Ireland than elsewhere.
I want to pick up on the comments made by the Secretary of State at the weekend to the British-Irish Association in Oxford. The conference is held under Chatham House rules, but I want to comment on what is in the public domain, as released by the Northern Ireland Office itself. In that speech, the Secretary of State was very negative about the concept of a financial package. He talked about money being thrown at Northern Ireland and Executives having squandered financial packages in the past—and there might be an element of truth to that. He said that the Executive need to stand on their own two feet—and, again, that is a worthy aspiration. But I stress that the notion that Northern Ireland can run a balanced budget, invest in public services and drive the economy from a burning platform will never happen. We will see more cuts flowing from budget cuts, and we will end up with decline and more decline. We will end up in a downward spiral in which Northern Ireland becomes ever more dependent, and we will see activity stop and more and more young people leave. That is not the future that I hear the Government articulating in their vision for a prosperous society in Northern Ireland, but what they are doing in terms of the budget belies their very worthy aspiration.
I ask the Minister of State or the Secretary of State to clarify in winding up that something will potentially be on offer when we seek a financial package. I appreciate that that is something that the Government may wish to do solely in the context of a restored Executive rather than up front, but it is important for any financial package to be based around transformation, a proper strategic plan and a programme for government for a restored Executive. That Executive must have clear targets and milestones, and a very clear idea as to how investment can turn Northern Ireland around. That is something on which a restored Executive can work in partnership.

Steven Baker: The hon. Gentleman has just hit the nail on the head: a restored Executive could work in partnership with the Government. But I just emphasise to him that the sum available in this budget is the same as would have been provided were an Executive in place. Just to take further his point about reform and so on, he will know that since 2014, we have put £7 billion into Northern Ireland on top of the block grant. Various commitments to reform have been given in different agreements over the years on various fronts, including education, but it has not happened. I think we are all now getting to a point where we are terribly frustrated on all those fronts. He has hit the nail on the head: we need a restored Executive and then to work in a positive way together to make Northern Ireland function for its people, and that is what we are very willing to do.

Stephen Farry: I am very grateful to the Minister of State for his comments. I largely agree with him, but I will point to a certain disagreement on some aspects. I fully recognise that there have been past financial packages and problems with reform not being fully realised, particularly around integrated education, which is a clear example. We have to do better in that respect. From where we are, I do not see any alternative to trying to do that once again and learning the lessons  from what happened in the past. I recognise that we have seen additional funding packages from the UK Government—obviously, we had a major uplift in support to deal with covid and its side effects on the economy, and that support was very welcome—but the fact is, as other Members have said, that our expenditure per head is not based on our need, and that fundamental point has to be recognised.

Gavin Robinson: I think it is helpful to emphasise at this point that, although the Minister indicated that this budget is exactly what an Executive would have been allocated were they in place, last year it was £322 million less than what an Executive would have needed, this year it is £431 million less than what an Executive would have needed, and the projection for next year is £458 million less. So in saying what he said, has the Minister not confirmed the real problem at the heart of this?

Stephen Farry: Indeed. I think we are talking to two separate points in that regard. Yes, the block grant would have been based on the current policy approach from the Government towards the Barnett formula and the assessment of need in Northern Ireland, but what we on these Benches are all saying is that we need to reassess the whole basis of how that is reflected. That is a conversation to be had. I would also take the point a bit further by saying that, if we had had an Executive in place, or indeed if we get an Executive in place shortly, that would be the form by which we could make this case much better to address both the fiscal squeeze and the negotiations on a financial package for Northern Ireland.
To give a human flavour to the scale of the crisis facing our society, I will close with one example of an area of crisis in Northern Ireland: special educational needs. There is a real crisis happening in that regard: the funding available is not meeting the levels of need. As I think all Members appreciate, this is one of the most sensitive areas, and one where Government has a duty to invest in children and ensure that their rights are properly protected. As we meet this evening, that is simply not the case in Northern Ireland. There are multiple failures to provide for children; the academic year has now started, but scores of young people still have not been allocated suitable special educational needs places. That has a major toll on parents and families—mental health issues and financial and career pressures—and on the children themselves, particularly a lack of opportunity, health and safety issues, a risk of regression and a lack of social inclusion. I appeal to Members, from whatever perspective we look at this—the Government in terms of setting the financial parameters, and also those who are still holding out for an Executive—that we need to get back to addressing those types of issues. That is what the coalface is like, and that is what we should be prioritising.

Ian Paisley Jnr: We are approaching tomorrow, so I will try not to detain the House too long with the comments I wish to make on this important Bill. At the outset I want to pay tribute, as others have, to the hon. Member for Hove (Peter Kyle), the former shadow Secretary of State, who has now moved on to another post. He visited my constituency on more than  one occasion and spent time with businesspeople and community leaders there, which was much appreciated. It was very clear that he wanted to learn as much as he possibly could about Northern Ireland, and he used that information wisely and, on many occasions, powerfully in this House. I hope he continues to maintain that interest, particularly in the hydrogen technologies that he looked at in Northern Ireland, in his new role. I wish him all the very best.
I also welcome the right hon. Member for Leeds Central (Hilary Benn) to his new post. He brings a level of gravity to the post, which is very important, and I wish him all the very best as well. I hope that, as a supporter of Leeds United, that brings us closer to at least some extent.
When the Minister of State opened the debate this evening, he made it clear that he was putting a budget in place—I think I quote him correctly—that would allow Northern Ireland Departments to continue to function. That was its purpose. Of course, at some level those Departments will continue to function, but they will function on the most stingy budget Bill ever brought forward: a Bill that is a crisis point. Whether there is direct rule, the current formation that we have, or a devolved Assembly operating, the current budget is inadequate. It is a disaster for many of the Departments in Northern Ireland, and it will not allow government to function, or to function normally. Many of those Departments have been cut to the bare bone with regard to what they will be expected to deliver.
What lies at the heart of this budget Bill? Of course, it is a fundamental unfairness. It is unfair in terms of the budget allocation; the formula, or the definition of need, that has been used in relation to Northern Ireland; and the outcome that it will have for the people of Northern Ireland, irrespective of their political or other identity. This is a grossly unfair budget, and it will impact harshly on the people of Northern Ireland. It has been described as a “punishment budget”, and I say frankly to the Secretary of State, his Minister and his team that I think it is designed to be a punishment budget—to punish Northern Ireland because of political circumstances.
If the Government are making an argument tonight that they want an Assembly back, this is a very strange way to go about it, because they are basically saying to the political class in Northern Ireland, “If you go into the Assembly and you try to run it on this pinching, stingy budget, you will deliver to the people of Northern Ireland a disastrous arrangement.” It is no encouragement whatsoever to politicians to go into the Assembly on that one narrow point of the budget. Of course, my right hon. Friend the Member for East Antrim (Sammy Wilson) has outlined much more detailed reasons as to why Unionists would not go back into the Assembly on the current arrangements until issues around the Windsor framework and the protocol are resolved.
If ever we needed leadership from the Government that led to decisive outcomes, it would not be this stunt budget that has been pulled in Northern Ireland. It is a pathetic excuse for a budget, and it will damage the opportunity to try to build better relationships not only within this House, but across Northern Ireland. The Government would not dare bring forward these sorts of arrangements for any other part of the United Kingdom—they simply would not dare and they would  not have the affront to do it—and it is appalling that they are doing that for this part of the kingdom, Northern Ireland.
The hon. Member for North Down (Stephen Farry) rightly identified that, if we are going to raise more revenue opportunities and invest in the public service, we need resources to do that. I notice that, in our newspapers every day, there are threats that the Northern Ireland Secretary is going to introduce water charges. I have heard this before. When I speak to the head of Northern Ireland Water, she tells me that, to get us back to an even keel in Northern Ireland with regards to the infrastructure of our water service, we need to invest about £2 billion. That is just to get it back to a level playing field and to a state where we could charge people for the water service. Are the Government proposing to put that sort of investment into the process, or are they just saying, “No, we’ll bring in water charges”? It is impossible to bring in water charges and well the Secretary of State knows it.
Just look at the cuts that are being proposed. The shadow Secretary of State rightly identified the problems to do with the concrete in schools across Northern Ireland, yet the education budget is being given the single largest kicking by the Government. Its budget is going to be down by 2.7%. If there is a crisis identified in the schools’ structure—another crisis in the schools’ structure—they just will not have the resources or the capability to resolve that, and we are going to see a major funding crisis there. Justice funding is down by 1.5%; I will come to some more points about that in a moment. Of course, the Department for the Economy funding is down by nearly 1% and this comes in the jaws of the great economic conference the Government are holding in a matter of seven or eight days in Northern Ireland. They are going to invite investors from all over the world and to say, “Come and invest in Northern Ireland—by the way, we have decided to cut the budget of the Department for the Economy, and we have decided to cut the budget for education and for other parts of Northern Ireland”. What sort of a message is that going to send to potential investors? If the Secretary of State has to try to sell these issues to outside investors whenever they decide to cut the budget, I certainly would not want to be a Northern Ireland-based devolved Minister trying to make that point.

Steven Baker: Thankfully, the hon. Gentleman is not writing the speeches for the investment conference next week because, if he were, it would not be very successful. What he knows and I know—and any of us in this House know who knows Northern Ireland—is that it has an amazing, vibrant private sector with terrific entrepreneurs, who are incredibly well grounded in place, care about their communities, and care about making a profit justly while taking care of the environment. They are amazing, inspiring people who can succeed if they are provided with the right capital. If anything, what we are trying to do here, on the point he makes, is to make sure that the very poor quality politics of Northern Ireland ends up matching the very high quality of the private sector. If we could pull that off, Northern Ireland would soar.

Ian Paisley Jnr: I thank the Minister, but I was once told, “If you throw a stone among a pack of dogs, the one that yells the loudest has been hit the hardest.” I think  that point maybe hit the Minister just a little bit this evening in that he knows that to say to investors, “By the way, we’ve cut the budget”, is not actually a good look for the Minister.
I want to turn to the issue of the cut to the Department of Justice funding; it is down by 1.5%. We all know that the morale of the police is at an all-time low. The issue of police pay for probationers has been raised in this House. It is very difficult to encourage young and newly qualified police officers that what they are doing is worth while. That is because the Department of Justice is going to be faced with another cut.
We have had the drama in recent weeks of the data breach. Police on the database have, shockingly, been given advice that they should remove themselves from the electoral register. That is one of the ways in which they can now protect themselves, undermining the democratic process for them and their families. The integrity of the MI5 officers who work in Northern Ireland has been undermined. That has a massive cost not just economically and politically, but to our security. Of course today there has been the loss of the Chief Constable, who decided to make decisions at the behest of Sinn Féin; rightly, he has had to resign. Who can calculate at this point what the cost of this will be, not just economically but to policing and to resolving that problem? I am disappointed that today the Secretary of State hedged his bets on who will pay the costs of the data breach; compensation will run into tens of millions of pounds. With Department of Justice funding cut by 1.5%, it is impossible to take that level of cost from that Department. The Secretary of State knows that he must do better, that this is not a good budget and that it will hit some of the Departments in Northern Ireland that mean the most the hardest.
Northern Ireland’s biggest industry and single largest employer still today is agrifood, making good-quality, tasty food. It does so not just for the people of Northern Ireland: the 30,000 or so farms in Northern Ireland make food and feed about 17 million people here in the rest of the United Kingdom. That sector of our economy is facing problems because that industry is about to have its veterinary medicines violated by this Government. Under the Windsor framework, the problems facing our farms are coming at them at 100 mph. Over 50% of our medicines for that sector are going to be denied and the UK Government say, “We are in discussions to resolve this issue.” The fact of the matter is that Europe has made it very clear that those discussions are over, yet the Government still think they can solve that. That crisis is coming too and the Government will need to resolve it and do so very soon. I hope that they do. I hope that they actually listen to these points, instead of getting tetchy about them, and recognise that the threat they have caused to the people of Northern Ireland by such a stingy, nasty budget, in such a procrastinating manner, is not serving the purpose of getting Government back into Northern Ireland, but is putting us further into the doldrums.

Meg Hillier: The hour is late so I will cut to the chase, but I think it is worth underlining the views outlined by those from the Front Bench on both sides that the best way to resolve the issues and debates around the Northern  Ireland budget will be if the Executive is meeting. It is a terrible shame that we are still debating and setting the budget here. That is not something the Secretary of State for Northern Ireland should be doing and I am very concerned that the situation continues.
I rise because of my particular interest as Chair of the Public Accounts Committee in the UK in the oversight and investigations of the Northern Ireland Audit Office in making sure the money allocated to the Northern Ireland Office and Departments in Northern Ireland is properly scrutinised. I appreciate the Minister taking time to meet me to discuss this because, without the Executive and Assembly in place, there is no real scrutiny of these budgets and it is the Northern Ireland Audit Office that has that particular role. It is important, therefore, and I remain disappointed that its funding is not where it should be.
I know that the amendment was not selected, but the Minister is talking to the right hon. and learned Member for South Swindon (Sir Robert Buckland), and the Chair of the Select Committee, the hon. Member for North Dorset (Simon Hoare), about the proposal that the Northern Ireland Assembly Audit Committee may continue to exercise its power even without an Executive. If that is something the Government are willing to discuss, I will be interested in being involved in those discussions. I can see a number of constitutional challenges on this, even within the context of Northern Ireland, let alone across the UK, but we need further scrutiny if we are going to live through this limbo.
I reflect the points of my right hon. Friend the Member for Leeds Central (Hilary Benn), who I am delighted to see on the Front Bench in the shadow Secretary of State role, that the Government need a better plan. Within this limbo, we have this inadequate position with the Secretary of State. However brilliant any Secretary of State is, they should not be making these decisions directly, and I am pretty sure that the Secretary of State agrees with me on that, yet we do not have any plan or pathway to getting the Executive back. It is down to the parties here present and not present ultimately to do that, but the Secretary of State needs to consider that.
I am concerned about the trajectory for support for audit in Northern Ireland, and I hope that the Northern Ireland Audit Office can do the best it can with the money it has and perhaps prove its worth to the Secretary of State for future budget settlements. I hope we are not here in a year’s time and that we have an Executive up and running that will be making these decisions for themselves.

Carla Lockhart: I add my comments about the outgoing shadow Secretary of State, the hon. Member for Hove (Peter Kyle), and congratulate the incoming shadow Secretary of State, the right hon. Member for Leeds Central (Hilary Benn). I wish him all the best; he would be most welcome in the Upper Bann constituency—the premier constituency in Northern Ireland—in the coming weeks and months.
The stark reality of the debate tonight is that the budget given to Northern Ireland Departments is not enough for the effective delivery of services in Northern Ireland. Some £297 million is scheduled to be taken  from our allocation this year and next. That is a huge chunk of the cake being taken away, from a cake that is already too small to satisfy the appetite or demands of our public services. I am being continually contacted, as I know are colleagues on these Benches, by constituents who are feeling the full effects of this harsh budget and the realities of our underfunded services: of health service waiting lists, crumbling school estates and scrapped road plans. While the physical infrastructure needs of our services are vast, so too is the even greater need of an even greater asset: our public sector workers. They ask for equality in pay, yet this Government refuse to give it. Some £575 million for public sector pay awards is needed, yet the cake is being cut and not made bigger to award people what they deserve.
The line that the Government cannot step in to deal with this matter does not wash with me or the public in Northern Ireland. If the Government want to do something, we see that they go and do it; we only have to look at the track record around the implementation of abortion in Northern Ireland against the will of the vast majority of people in Northern Ireland, or the relationships and sex education guidelines that have been foisted on the people of Northern Ireland without any consultation. Frankly, they are out of step with the values that the vast majority of parents want to instil in their children. The Government should not come at us with this line that “the Government cannot act”, when they can on other issues where there is very clear opposition in Northern Ireland.
When and if the Government want to do something, they do it, yet we see a lack of enthusiasm to deal with the issues that are keeping the doors of Stormont locked. We hear much from the Government that, if Stormont was back up and running, we could deal with the issues, yet they peddle false hope to those awaiting healthcare interventions and raise expectations among our public sector workforce about their deserved pay rises when there simply is not enough money to deliver such increases.
Our party leader, my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson), has said time and again that this party deals in realities. Those are the political and constitutional reality created by the protocol and Windsor framework, the economic reality created by the same, and the public reality that Unionist people have withdrawn their consent for the devolved institutions until their concerns are dealt with and our place within our Union is restored. Sadly, there are those who seek to lay blame for all ills at my party’s feet, yet it is they who are exacerbating the situation by refusing to address the genuine concerns of the Unionist community and, indeed, the continued difficulties faced by many businesses as a result of the Windsor framework and the protocol.
We want a solution that brings a firm foundation for the restoration of Stormont. We want a solution that brings firm political and financial foundations, which will be the key to the impact that any new Executive will have. Underfunding cannot continue. We need transformational moneys and moneys based on the needs of our changing society. Next year—I will reiterate the figures that we have already heard—public spending in Northern Ireland will increase by 3.6%, but in England it will increase by 6%. How is that fair on my constituents in Upper Bann?
My hon. Friend the Member for Belfast East (Gavin Robinson) made a significant contribution on the budget needs and the transformation of the Barnett formula to a needs-based formula. It is time for the Government to act. The people of Northern Ireland—people of this United Kingdom—deserve it. We in Northern Ireland deserve as much as those in England are getting. I implore the Government to do what is right and get a political and financial solution that will allow Stormont to be restored and got up and running, with decisions made in Stormont.

Mary Foy: I welcome my right hon. Friend the Member for Leeds Central (Hilary Benn) to his new role. It should be the concern of the whole House that a Secretary of State for Northern Ireland, rather than a Minister of Finance in Stormont, is delivering yet another budget for Northern Ireland. This has been happening for far too long. It should concern us, because it reflects a peace process that has become increasingly precarious.
I am a member of the Northern Ireland Affairs Committee, which since February has been inquiring into the funding and delivery of public services in the north of Ireland. We have received evidence from a wide range of stakeholders throughout Northern Ireland. We have focused on the financial situation in areas such as education and health, and how the lack of a functioning Executive in Stormont is affecting those public services. To be clear, these are my views and not those of the Committee as a whole. My personal view is that the absence of an Executive in the north of Ireland, coupled with an austerity budget from Westminster, is a toxic mix, both politically and socially. For instance, we heard from the British Medical Association in Northern Ireland that health services are operating in “crisis mode”, which has taken its toll both on patients and on workers. Underlying that is a
“crumbling estate, with spiralling maintenance costs”.
The Royal College of Nursing argues:
“The health and social care system…is now beyond the point of crisis and is…visibly collapsing.”
It argues that that is due to “years of systematic under-funding”, compounded by the absence of accountability and leadership in Stormont. In addition, the Royal College of Surgeons has stated that one in four people in Northern Ireland are on a waiting list, either for a first-time appointment with a consultant or for surgery or treatment. The health and social care system needs stability, much like it does in Britain. Prevention is always better than cure. In one evidence session, I asked health professionals whether a significant cash injection now would reduce costs down the line. Austerity is never the cheaper option; it always leads to higher costs. I just wish the Government would realise that.
I want to touch on the impact on education, where, as with health, it is unacceptable that cuts are being made. A report in June entitled “The Consequences of the Cuts to Education for Children and Young People in Northern Ireland” argues that
“cuts will increase poverty, widen existing educational achievement gaps”
and “further exacerbate” the mental health crisis in Northern Ireland. Like the healthcare system, as we have heard, special educational needs provision is beyond the brink.
There is also a constitutional issue. My colleagues in the Social Democratic and Labour party have called on the British Government to consult the Irish Government on provisions for this budget as a plan B. That is a very sensible argument, although it is quite surprising that the British Government have not already attempted it. We cannot forget the vital role that the Irish Government played in the peace process. We should not forgo their advice, assistance, guidance and institutional knowledge.
In addition, the pressure on civil servants in Northern Ireland must be commented on. They are working in an extremely difficult environment, and we must recognise that there are unintended consequences. Civil servants are between a rock and hard place. The guidance states that some decisions should not be taken by civil servants, but without an Executive, those decisions must be made. As PCS Northern Ireland has argued, how can civil servants do their jobs effectively when they are worrying about putting food on the table for their families?
Underlying all this is a lack of democratic accountability. At the risk of making an obvious point, it was political parties who were elected in the May elections, not civil servants. If there is no Executive, who will fill those leadership roles in the community? We have heard in the Northern Ireland Affairs Committee that, sadly, some of those roles are already being filled by criminal gangs and paramilitaries. Those gangs are preying on vulnerable people, especially women in deprived communities. They know that there is an absence of statutory childcare, which is a huge barrier to women attaining employment. Those gangs are exploiting poverty. When people have not been able to pay their loans, for instance, they have been forced into transporting drugs and prostitution.
It is a case of austerity affecting services, and a deadlock affecting leadership, leading to cracks in civil society that demand our attention right now. We need the Executive back. To that extent, I must say to the Democratic Unionist party to honour the first word of its name. This boycott is doing real harm. Everyone can see it. I suspect it is not what their constituents want to see. Nothing can be achieved in this deadlock; it only wears people down. But we can achieve something working together. I will never forget the demonstration of cross-party unity that brought peace to an island that means so much to me, my family and so many people in my constituency and beyond. It would be a tragedy if that the spirit of co-operation was consigned to the history books.

Lindsay Hoyle: I call Jim Shannon.

Jim Shannon: Thank you, Mr Speaker. It is good to see that you and I are the Duracell batteries of Westminster; we keep going when others are starting to lag.
What a pleasure it is to speak on this issue today. Yet again, I come to the House to ask for fairness and equitable treatment for Northern Ireland. I ask for it to be treated and funded the way that Wales is, for the sake of my constituents and all other constituents in Northern  Ireland. I ask for our schools to be able to pay for their teachers’ pay rise and for toiletries in school facilities. I ask for a budget that can address the waiting list for hip replacements, and for vital roadworks to be carried out, to provide the bare minimum standard of infrastructure and connectivity. I ask the Secretary of State respectfully to advocate working with us and for the betterment of everyone in Northern Ireland. I believe we can do that together if we all commit to that process.
The people of Ballynahinch and the surrounding areas in my constituency of Strangford have been waiting my entire tenure—I have been an MP since 2010—and long before that for the promised Ballynahinch bypass, which has been deferred yet again. Along with my MLA colleagues Michelle McIlveen and Harry Harvey, I hope to meet the Department for Infrastructure on 6 October to discuss that very issue. It has been on the books for 45 years. And should the hon. Member for South Down (Chris Hazzard) ever decide to take his seat in this place and do his job here, he would be advocating for the same thing: for the funding to be allocated for this vital piece of work. Not to be blunt, but any claim that work can be carried out in whatever way the Department sees fit does not cut it when the current budget does not cover the cost for roads to be resurfaced, never mind major capital projects. Let us be truthful here: the budget allocation for roads is inadequate.
On a slightly more positive note, I highlight Ardglass harbour as a Northern Ireland fishing industry success story. However, the fact is that if we are to build on that success and accommodate the next generation of fishing boats, the harbour needs to be deepened. Kilkeel is also well placed to be a hub for the offshore energy industry. Investment there will see Northern Ireland capitalise on our growing blue economy. The fishing and seafood development programme of the Department of Agriculture, Environment and Rural Affairs recommends investment in all three harbours, and that takes funding. I am delighted to report that funding has been secured for both an enhanced training centre and an improved slipway in Portavogie in my constituency of Strangford. We can build on that and do more. We should have aspirations to grow a powerhouse of a blue economy. Portavogie, Ardglass and Kilkeel give us the building blocks, and the FSDP recommendations give us the tools. What we now need is to add a further budget that has the appetite and ambition to match that of our coastal communities, and that empowers them to meet the next generation of opportunities in the Irish sea and beyond.
We need funding for schools to deal with the substantial rise in special needs assessment and support. The hon. Member for North Down (Stephen Farry) referred to that and he is absolutely right. Every one of us in this House knows that special needs education is under incredible pressure. Funding is needed to create sensory rooms, whose enhancements will give children the opportunity to excel. I have met them in many of the schools in my constituency, and I recognise that that is something we should all sign up to. I sign up to the vision for schools that is operating on the mainland, but I would like our children to be treated the same way as children here and to have the same options. That is not the case because while spending per head is more, so is cost and so is need.
Policies that impact on how our children are taught about religion and sexual issues should not be implemented without a mechanism and space to consult boards of governors or without the opportunity to implement normal practices. Let me be clear: parents and teachers do not consent or comply, and that will be made clear in the days to come. There was a rally where a large group of people came together with some of their elected representatives to make that point.
I conclude with this, because I am very conscious of the long hour. I say this to the Secretary of State and the Minister of State: please, in the interest of fairness and equity, work with us to make changes to the framework that allow us to do what we want to do, which is to take our seats and for our colleagues to be in a working Assembly, with a fit-for-purpose budget and changes in place. That is not only in our hands; it is in the hands of the Government, the Secretary of State, the Minister of State, the Brexit Minister and the Prime Minister. Do the right thing and start to take that action, so we can move forward together in a positive fashion.

Lindsay Hoyle: I call the Minister.

Steven Baker: With the leave of the House, Mr Speaker, given that I made a number of interventions during the debate, and given the late hour and a desire not to repeat arguments that we advanced on Second Reading, I think I should just say, “I beg to move.”
Question put and agreed to.
Bill accordingly read the Third time and passed.

Education, Employment and Training: Young People

Motion made, and Question proposed, That this House do now adjourn.—(Joy Morrissey.)

Philip Hollobone: It is a huge pleasure to see you in the Chair, Mr Speaker, and thank you very much for granting this debate. It is now midnight, and I am not sure that I have ever had the privilege of addressing the House at such an early hour, but it is always a privilege to stand up and speak out on behalf of my constituents.
I welcome my right hon. Friend, and good friend, the Minister to his place. He has been devoted to promoting both his constituency of Harlow and educational opportunity ever since he came to the House, not least through his previous superb chairmanship of the Education Committee. Now in his second iteration as Minister for Skills, he stands out as a Minister who is very much a round peg in a round hole, and we are lucky to have him.
Education, employment and training for young people is a hugely important issue for both our country and local residents in the constituency that I have the huge privilege of representing. I was alarmed to discover recently that some 788,000 16 to 24-year-olds are not in education, employment or training—which seems to me to be a very large number—and that although the overall unemployment rate in my constituency, at 3.6%, is below the national average of 3.7%, 420 18 to 24-year-olds are without work and the youth unemployment rate is 6.2%, while the national average is 4.7%.
Those young people who are not in education, employment or training are frequently referred to as NEETs. I was alarmed to be informed that 57% of NEETs are young people who have previously been in some form of care setting, and that many of these young people will also have left their school or college without gaining GCSE qualifications at level 5 or above in the basics of English and maths. Those are uncomfortable and disappointing statistics, and as a country we can and must do better if we are to give all our young people a good start to their adult lives.

Jim Shannon: Will the hon. Gentleman give way?

Philip Hollobone: I should be honoured and delighted to do so.

Jim Shannon: I congratulate the hon. Gentleman on securing the debate. He has always brought good subjects to the House, and tonight, after midnight, he is doing so again. It will be known throughout the House that I am a keen supporter of apprenticeship programmes for young people, which provide an excellent opportunity for those who want to take up a trade and go straight into the world of work, as opposed to further study at university. South Eastern Regional College—SERC—in my town of Newtownards does a fantastic job in supporting young people through that transition. Does the hon. Gentleman agree that more needs to be done to ensure that apprentices are paid equally and fairly, and that the   best way we can show that their work and contribution to society are valued is to give them money for what they do by the sweat of their brow?

Philip Hollobone: The hon. Gentleman makes an extremely good point. The Government are doing good work with A-levels, T-levels and apprenticeships, but 788,000 young people are falling through the net. The purpose of this debate is to highlight that number and encourage the Minister to tell the House what the Government are going to do about it.
Young people in this country should be encouraged to be in good-quality education, training or employment and to enjoy the right to fulfil their potential, whatever and wherever that may be. The good news for Kettering is that we are fortunate enough to have—based in Station Road, near the heart of the town centre and the railway station itself—a wonderful organisation called Youth Employment UK, which was established and is led by its enthusiastic, talented and inspirational chief executive, Laura-Jane Rawlings, known to all as “LJ”. She is ably assisted by Joshua Knight, the senior policy and research lead, and a hard-working staff of 14.
Youth Employment UK is a national, not-for-profit organisation that was set up in 2012 with a focus on tackling youth unemployment. Funded not by the taxpayer but by an expanding membership of enlightened employers, in the last 10 years it has become one of the leading experts on youth employment, and an active partner to Departments including the Departments for Education and for Work and Pensions.
Last Thursday, 31 August, I met the Youth Employment UK team at their Kettering HQ, together with Robin Webber-Jones, the Northamptonshire principal of Tresham College, which is part of the Bedford College Group, and Councillor Scott Edwards, the portfolio holder for education at North Northamptonshire Council, to explore how the promotion of youth employment, education and training might best be advanced at both national and local levels. From that meeting, it was clear to see Youth Employment UK’s expertise and commitment to all young people across the UK, and I commend Youth Employment UK to the Minister.
In this debate, I have four asks of the Minister, please. First, will he be kind enough to visit Kettering to meet me and representatives of Youth Employment UK, Tresham College and North Northamptonshire Council to discuss the local and national challenges of youth education, employment and training? Secondly, will he ensure that while the Government raise the ambitions for young people to achieve A-levels, T-levels and quality apprenticeships—which the hon. Member for Strangford (Jim Shannon) has just highlighted—groups of young people are not left behind? Thirdly, will he expand ambitions and support for young people and create a NEET strategy with a commitment to reducing the NEET rate—a strategy that must focus on both reduction and prevention? Fourthly, will he commit to ensuring that all employers are working to the good youth employment standards, driving up the quality and volume of job opportunities for young people?
Youth Employment UK is home to the national youth voice census, an annual survey that explores with young people aged 11 to 30 what is and is not working for them on their journey to work. I know that the Department for Education already welcomes this annual  survey and is already using it as a tool to help shape and inform its policy work. The 2022 report was downloaded more than 70,000 times. It has been referenced in a number of Government reports and received local, national and international coverage. On 14 September, in just 10 days’ time—nine days’ time now—Youth Employment UK will launch this year’s findings, and as I have been privy to some early insight from the team, I can give the Minister a sneak peek into some of its findings. This year’s survey makes it clear that in 2023, young people need more support and more help from the systems around them. Young people across the UK have shared their lack of confidence about their futures and next steps, telling Youth Employment UK in their thousands about the disconnect they feel in their communities. The future is feeling more uncertain for young people than in many previous years.

Ian Paisley Jnr: I thank the hon. Gentleman for raising this important debate. The subject of skills development and the improvement of people within employment is close to my own heart. Does he recognise that there is a disparity in how this policy plays out across the whole of the United Kingdom? For example, the apprenticeship levy is collected in Northern Ireland but it is not allocated to apprenticeships there, so we are taxed but the levy is not available. Secondly, we export one third of all our students in Northern Ireland to GB, but they rarely come back. That has to be fixed.

Philip Hollobone: The hon. Member makes some extremely good points. It does not seem right that the situation he describes should be as it is. Perhaps the Minister, in his response, will be able to give the Government’s response to those important issues. I shall be in touch with representatives of Youth Employment UK, who will be interested in Northern Ireland, and I will ask if they would be kind enough to contact the hon. Member’s office to see whether this could be explored further.
The key findings and recommendations from this year’s youth voice census will provide us all with a clearer understanding of the issues that young people are facing in our constituencies, in our schools and as they enter the workforce. This should be a call to all of us, and in particular to the Government, to make a commitment to understanding what young people really need in order to feel confident about their futures.
The Government’s plan for education is a strong one, streamlining qualifications and ensuring parity of esteem between vocational pathways and university. In order to support future-ready young people who have the skills required to build our future workforce, we have to hear the voice and expertise of all types of employers and more varied groups of young people.
Individual circumstances will likely be the biggest factor in a successful next-step transition and, of course, not all young people have the same starting point. Pathways and programmes must be designed to be accessible and flexible enough to benefit all young people. We therefore must be sure, at both national and local level, that young people will not be left behind by any education reform plans.
I am delighted that Youth Employment UK is leading a commission on the reforms that have been introduced and will be case-studying a number of local areas,  including Kettering, to see what the reality of education reform means for young people and their personal situations and aspirations. I hope these case studies, when published, will be a useful moment for my right hon. Friend the Minister to assure us that there are ladders of opportunity available to every young person, everywhere.
While my right hon. Friend is developing future education and training pathways, I hope he will have a particularly keen eye on the actions required to support those 788,000 young people who are currently NEET. Through its work as the secretariat to the all-party parliamentary group on youth employment, Youth Employment UK is stressing the need for the Government to make a guarantee to young people that there will always be a quality opportunity for them and that the Government will level up the systems around supporting and promoting young people.
In its 2022 report, produced with PricewaterhouseCoopers, the Youth Futures Foundation, which is a beneficiary of dormant assets funding, identified that bringing our NEET rate down to that of our German friends would benefit UK GDP by as much as £38 billion. It must therefore be a matter of utmost importance to the Government that we have a NEET strategy focused not only on reduction, but on prevention too.
I am delighted to advise my right hon. Friend that Youth Employment UK was commissioned by the Careers & Enterprise Company to write a paper on NEET prevention and reduction, and that the paper and its recommendations are available to the Department for Education. In addition, Youth Employment UK has co-produced a young person’s guarantee along with the Prince’s Trust, the Youth Futures Foundation, the Institute for Employment Studies, Impetus and the Learning and Work Institute as co-chairs of the Youth Employment Group, which will be sure to add value to the DFE and other Government Departments in their efforts to tackle youth unemployment.
Over the last 10 years, Youth Employment UK has been providing free skills and careers information to young people aged 11 to 30. Its superb website, which I have seen and which I encourage my right hon. Friend to view for himself, is an encyclopaedia of information, inspiration and advice for young people. I was impressed to see on my visit to Youth Employment UK’s headquarters that the website is powered by young people themselves, as Youth Employment UK is an excellent employer of young apprentices. The website helps more than 200,000 young people a month, or 2.4 million a year, to understand all their options and pathways, and how to navigate and prepare for the world around them as it changes. I am sure my right hon. Friend will join me in congratulating Youth Employment UK on this valuable work.
Instrumental to the role that Youth Employment UK plays is its work with employers. Employers are key to tackling youth unemployment and to creating the experiences and opportunities that young people need to move on in the world with confidence. By understanding young people, Youth Employment UK is able to advise and support employers to create quality and inclusive opportunities for young people. Youth Employment UK has created the good youth employment standards and has more than 1,000 employers in its membership that are leading the way in driving up good youth employment standards and opportunities.
Employers such as Coca-Cola Europacific Partners, Pret a Manger, Sodexo, Haven, Severn Trent and Surrey County Council are among the many working with Youth Employment UK and investing in apprenticeships, T-levels and inclusive recruitment for young people. As passionate as my right hon. Friend is about T-levels and their placements and apprenticeships for young people, I am sure he will agree that we need more employers to provide opportunities at a national, local and hyper-local level. I hope he will join the Institute for Apprenticeships and Technical Education, the Department for Work and Pensions, and these more than 1,000 employers in recognising the importance of the good youth employment standards and the work that Youth Employment UK does to drive quality and to connect young people to good employers.
In closing, let me reiterate my four asks. Will my right hon. Friend be kind enough to visit Kettering? Will he ensure that while the Government promote A-levels, T-levels and quality apprenticeships, groups of young people are not left behind? Will he create a strategy to reduce the number of young people being or becoming NEETs, and to prevent it from happening? Will he ensure that all employers are working to the good youth employment standards? Thank you, Mr Speaker, for your indulgence at this early hour. I look forward to the Minister’s response.

Robert Halfon: I heartily congratulate my hon. Friend the Member for Kettering (Mr Hollobone), a real friend whom I have known for many years, on securing the debate. Not only is he passionate about his constituency, but as he has shown in his speech, he is passionate and knowledgeable about youth employment, skills, apprenticeships and much more besides. It is an honour for me to be able to respond to him in this debate. He is also a member of the all-party group on youth employment, and he wants young people to acquire the education and skills they need in Kettering. He is absolutely right about that, and he wrote to me about it before the summer. I welcome the debate, because I share that passion.
Let me answer the first of his points by saying that I will be delighted to visit my hon. Friend’s local college and meet Youth Employment UK, perhaps at the college. His second request was about careers advice and support. Everything we are trying to do is to ensure that careers advice is central to our young people, and I will go into detail about what we are doing.
My hon. Friend’s third point was about having a strategy for young people who are not employed or in training—I dislike the terrible word “NEET”, as there is nothing neat at all about being unemployed and not in education or training. Not only are we working collaboratively with the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Mid Sussex (Mims Davies), and the Under-Secretary of State for Culture, Media and Sport, my right hon. Friend the Member for Pudsey (Stuart Andrew), in a cross-government youth forum, but we have a strategy in the Department.
I was over the moon when my hon. Friend the Member for Kettering mentioned the “ladder of opportunity”. Everybody who knows me knows that I talk about that all the time, and that ladder has a real strategy to it; it is not just a slogan. One pillar supporting that ladder is about strengthening higher education and further education, and the other is about opportunities and social justice. The first rung of that ladder is careers; the second is quality qualifications; the third is championing apprenticeships and skills; the fourth is lifelong learning; and the fifth is job security and prosperity. That last one is the goal for everyone to get to at the top of that ladder. Our Government bring people to the ladder and help them climb up every step of the way. That is the strategy, and there is a lot of detail to each part of the ladder.
My hon. Friend’s fourth request was about the good employer standards. I have worked previously with the Investors in People, which looks at employers who encourage apprentices and skills. I have been looking at the brilliant website of Youth Employment UK; as he rightly mentions, it is a Wikipedia of everything there is to know about youth employment. I will look at what it says and at the work of IIP to see whether there can be any collaboration there and with the Institute for Apprenticeships and Technical Education.
It is important to note that nationally the NEET figures for young people—16 to 24-year-olds—in England have been lower for several years. At the end of 2022, the rate was 12.3%; it is down by nearly a quarter since 2010. My hon. Friend has shared concerns about the slightly higher than average youth unemployment rate in his area among 18 to 24-year-olds, but there is some good news: just 2.6% of 16 and 17-year-olds in the wider north Northamptonshire area, covering his constituency, are not in employment or training, and that is well below the national average of 5.2%. Nationally, age 16 and 17 not in employment or training rates are consistently lower. In 2011 the figure was 6.6%, but by the end of 2022 it was just 4.5%. However, there is still a lot more to do, as my hon. Friend rightly highlighted.
The key thing that my hon. Friend wants to know is what we are doing for young people in his area, and I am happy to provide that information. As he pointed out, the main FE provider in his constituency is Tresham College, part of the Beford College Group, which has 7,700 learners on 16 to 19 studies. It boasts a huge range of full-time, part-time, higher education and apprenticeship provision, from science to business administration, from computing to care and childcare, and it is home to the prestigious training restaurant.
There are a number of apprenticeship providers in Kettering. As an aside to the hon. Member for North Antrim (Ian Paisley), who asked about the apprenticeship levy, he will know that that is devolved to Northern Ireland. We devolve a portion of the national apprenticeship levy raised to all the devolved authorities, and it is up to the devolved authorities how they spend it. In fact, the devolved authority has more flexibility than exists in England; in England the money has to be spent on apprentices, but the devolved authorities have much wider discretion on how they spend it. I am happy to look at that and work with him on it. I hope to go to Northern Ireland soon to look at the Turing scheme operating there, so I am happy to discuss with him and his colleagues how we can make the apprenticeship system work better in Northern Ireland.
My hon. Friend the Member for Kettering will be pleased to know that there have been 11,220 apprenticeship starts in Kettering since May 2010, and there were 770 last year. There are great apprentice employers for young people in his area, such as Travis Perkins, Northampton Healthcare, Mercedes and AMG High Performance Powertrains, which produces Formula 1 engines. There is the Creating Tomorrow College, a specialist post-16 institution that looks after 16 to 25-year-olds with cognition and learning difficulties. I am sure my hon. Friend is proud of that.
We are making a huge investment in post-16 education, benefiting constituents in Kettering, in my constituency of Harlow and across the country with an additional £3.8 billion over this Parliament. We are improving the FE estate to the tune of £2.8 billion. We announced a £125 million boost to further education back in January, including £12 million for the Bedford College Group. We announced even more funding for young people’s education: an extra £185 million in 2023-24, and £285 million to come in 2024-25. We invested over £7 billion during 2022, to ensure that there is a place in education or training for every 16 to 18-year-old who wants one. By 2024-25 we will be spending £2.7 billion on apprenticeships.
As I mentioned to my hon. Friend, one of the pillars supporting the ladder of opportunity is social justice. Skills education and training is fundamental to get those young people who are not in employment or training into work. I will briefly mention the three strands of social justice—place, privilege and prestige. Social justice is rooted in the places people come from—where they grow up, gain their education and find a job. We want to deliver for places that need a sustainable jobs and skills ecosystem.
There are 31 primary and six secondary schools in Kettering giving a good education to young people. There are 38 employer-led skills improvement plans across the country, working out what skills are needed in the local area. My hon. Friend’s constituency falls within the south-east midlands local skills improvement plan, bringing together employers to make sure they fill the skills deficit as we need them to. Previously, the strategic development fund awarded £1.25 million in revenue and £1.49 million in capital funding to south-east midlands colleges.
My hon. Friend talked about careers. We have the local careers hubs and we have done a lot of work on careers, ensuring that apprentice organisations go into schools. We have now legislated—I pushed this through when I was Chair of the Education Committee—to ensure that schools have to have at least six encounters with technical organisations, such as technical schools, apprentice organisations and further education colleges. The apprenticeship support and knowledge programme is going around the country encouraging young people to do apprenticeships and learn skills. My hon. Friend will be pleased to learn that in the past year, in north Northamptonshire, 8.5% of starts were taken up by those from minority backgrounds.
My hon. Friend talked about social justice quite a bit in his speech. We are investing £18 million in the supported internships programme. I worked hard to ensure that we could increase the care leaver’s bursary, which used  to be £1,000. It is now £3,000. A young person who has been in care can get a bursary to encourage them to do an apprenticeship.
Prestige is incredibly important. My hon. Friend mentioned the German system. When it comes to technical and vocational education, I would love for us to have the German, Scandinavian, Austrian or Swiss education system in our country. That is what we are doing with our T-levels and our higher technical qualifications. Some 390,000 technical awards or technical certificates have been issued to students, which is an incredible achievement. Then we have T-levels at post-16. My hon. Friend talked about expanded work placements, and we have 18 T-levels coming on board from this year. We have more and more students doing our world-class T-level programme, which is designed by employers. That means that students who do them will be likely to get good jobs. It is exciting that Tresham College is delivering T-levels.
We are strengthening further education, ensuring that we are recruiting excellent FE staff. We have brilliant further education colleges up and down our country, which do not get enough mention. We have introduced teaching bursary schemes of up to £29,000. We are getting bespoke industry experts to get into FE teaching to share their skills with the next generation. We will have 21 institute of technology colleges, 12 of which have opened so far, that will transform tertiary education in our country. They are teaching T-levels, higher technical qualifications and degree apprenticeships. They are all over the country and, with this collaboration of further education and higher education, they will be the transformative institutes of the future.
My hon. Friend mentioned the Careers & Enterprise Company, which now partners with 70% of schools and colleges. In his own area, the south-east midlands careers hub engages with 26 education institutions across north Northamptonshire, including nine schools and colleges in Kettering. We know that where there is interaction with the careers hubs and the Careers & Enterprise Company we have fewer young people not in employment or training and more people learning skills, doing apprenticeships or getting good jobs, which my hon. Friend and I both want to see. I should mention that on T-levels, this year we had a pass rate of 90.5%, with 69.2% of students receiving a merit or above. From this month, 18 T-levels will be available at nearly 300 providers. We have the apprenticeship offering and the T-level offering, as well as the traditional academic offer. I mentioned that he has T-levels being delivered in his local college and more in the pipeline. Higher technical qualifications—level 4 and 5—are being introduced as well. There will be 106 higher technical qualifications available from September 2023, offering yet more choice.
I have talked quite a bit about apprentices. We have now lifted the cap for small businesses so that they can employ as many apprentices as they want. We pay employers and providers £1,000 each when they take on a 16 to 18-year-old apprentice, and cover 100% of smaller employers’ training costs for this cohort. It is our job right now to give young people the opportunities that they need so that they can climb the ladder of opportunity—
House adjourned without Question put (Standing Order No. 9(7)).

Recall of MPs Act 2015: Member for Rutherglen and Hamilton West

Text of notification received by the Speaker on 1 August 2023:
I refer to the Recall Petition in respect of the Rutherglen and Hamilton West Constituency, which closed at 5pm yesterday, 31 July 2023. I am now emailing to advise that the Count of signatures has been concluded and the result is as follows:—
The total number of valid signatures to the petition was 11896
The total electorate was 81,123
The threshold of 10% of electorate was 8113
The number of rejected signing sheets on the grounds of being unmarked was 37
Therefore the threshold has been met for the recall petition to be successful.
Cleland Sneddon, Petition Officer